GAO attacks imaging self-referral, requests pay cut for exams


Aunt Minnie examines the recent GAO report taking a close look at self-referral for medical diagnostic imaging.

GAO attacks imaging self-referral, requests pay cut for exams

By Brian Casey, staff writer

November 1, 2012 — A new report from the U.S. Government Accountability Office (GAO) takes a hard-line on physician self-referral of imaging services, detailing more than $100 million in annual unnecessary spending in CT and MRI alone. The report recommends steps to curb the practice, including a pay cut for self-referred imaging studies.

Physician self-referral of patients to imaging scanners that they purchase or lease is a hotly contested topic. The practice is allowed through a loophole in the Stark anti-self-referral act, and proponents claim it offers convenience to patients who don’t have to be referred to another facility for imaging exams.

Opponents, however, believe it leads to wasteful spending as non-radiologist physicians order imaging exams for economic rather than clinical reasons. Radiology advocates have long requested that the U.S. government address physician self-referral as part of its efforts to control wasteful healthcare spending.

The GAO report is a sign that the government may be listening. The report was commissioned due to concerns over Medicare Part B expenditures — including those for advanced imaging services — which “are expected to continue growing at an unsustainable rate,” according to the report. The GAO said it was asked to examine the prevalence of imaging self-referral and its impact on Medicare spending.

The GAO report analyzed Part B claims data from 2004 through 2010, specifically focusing on CT and MRI services. The report found that the overall incidence of self-referral grew during the period, with the number of self-referred MRI studies increasing by 80% over the study period, compared to growth of 12% for MRI scans that weren’t self-referred.

In addition, healthcare providers who began to self-refer saw imaging volume spike shortly after they began the practice. Providers who began self-referring in 2009 increased their CT and MRI referrals by 67.3% in 2010 compared to 2008, and the average number of referrals increased from 25.1 to 42.0 during those years.

In comparison, physicians who were already self-referring in 2009 saw their imaging volumes drop 3.4%, from an average of 47.0 referrals in 2008 to an average of 45.4 referrals in 2010. For providers who weren’t self-referring at all, imaging volumes fell 6.8%, from 20.6 referrals in 2008 to 19.2 in 2010. The findings suggest that the increase was not due to an overall rise among all providers, according to the GAO.

The report estimates that in 2010, healthcare providers who self-referred likely made 400,000 more referrals for advanced imaging studies than they would have if they were not self-referring, and these referrals probably cost Medicare $109 million. The referrals are particularly problematic for CT, as they are exposing patients unnecessarily to ionizing radiation.

The report makes several recommendations to help the U.S. Centers for Medicare and Medicaid Services (CMS) identify and rein in self-referred imaging studies:

  • · The CMS administrator should insert a flag to identify self-referred imaging studies on Medicare Part B claims forms. Providers should be required to indicate whether the services for which they are billing are self-referred.
  • · CMS should implement a payment reduction for self-referred advanced imaging studies to recognize the efficiencies that occur when the same provider refers and performs a service.
  • · CMS should develop tools for ensuring the appropriateness of self-referred imaging services.

Response to the report was mixed. The Medical Imaging and Technology Alliance (MITA), which represents scanner vendors, found fault with the report, stating that two of the recommendations were “unworkable and unnecessary.” The report also failed to acknowledge that per capita imaging utilization has declined, and it failed to address patient access to imaging.

MITA believes that qualified physicians should be able to provide appropriate imaging services to their physicians regardless of their specialties — to do otherwise would limit patient access to care. MITA also noted that the U.S. Department of Health and Human Services (HHS) has agreed to examine the appropriateness issue, which MITA believes is best tackled through appropriateness criteria developed by physicians.

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Slowing of Healthcare Spending Due in Part to High Deductible Health Plans

As the economy continues to limp along, many Americans are feeling squeezed. Unemployment and underemployment are at elevated levels. Gas prices are high. But at least healthcare is getting cheaper, right?

Well, that depends on who you ask.

According to data from the Centers for Medicare and Medicaid Services (CMS), Health Care Expenditure (HCE) growth has slowed significantly throughout the recession (2009-2011). The last three years of HCE growth have been 3.8%, 3.9%, and 3.9%. From 1980 through 2008, HCE growth bounced between 14% and 6% annually.

 HCE vs % GDP

(CMS – National Health Expenditure Accounts)

On the other hand, HCE measured as a percentage of Gross Domestic Product (GDP) continues to gradually rise (depicted by the red line in the graph above). Aside from the debate about whether overall healthcare costs have truly slowed or not, it’s interesting to know that there has been a shift in who is bearing the brunt of healthcare expenses. From an interview with Susan Dentzer (Editor and Chief of “Health Affairs) on PBS:

“Private health insurance coverage declined almost 2 percent in the one year from 2009 to 2010. And, of course, it had declined in the prior year as well. So people were losing their jobs, losing their health care coverage, having to pay more. Those people who did have coverage have had to pay more. We know that employers have been shifting more of the costs of health care to workers.

So, now if you go to the physician or if you go to the hospital, the likelihood is that you’re going to have a higher co-insurance rate. You’re going to pay more of that bill directly yourself. So all of those things came together. And it meant truly people went to the emergency department less. People went to doctor’s offices less. People did less elective surgery in hospitals.”

While Ms. Dentzer’s comments speak directly to reduced health care expenditure attributed to unemployment, she also alludes to another factor. That factor is the emergence of the consumer directed health plan, otherwise known as a High Deductible Health Plan (HDHP).

In an article by Forbes, studies indicate that the use of HDHPs quadrupled during 2006-2011 and increased another 14% from 2010 to 2011 alone. Studies by the RAND corporation indicate that Americans who transition from traditional coverage to consumer directed plans use 14% less health care related services with no negative health outcomes.

This trend to HDHPs can be viewed as an effective tool for cutting healthcare costs and putting the choice in the consumer’s hands or it could be seen as an unnecessary burden to an employee in a tough economy.

Opinions likely vary, what is yours?