A study released yesterday by diagnostic imaging lobbying group Access to Medical Imaging Coalition (AMIC) found that 87% of the medical imaging procedures scheduled for Medicare reimbursement rate cuts under the Deficit Reduction Act (DRA) of 2005 would be reimbursed at levels less than the estimated cost of performing the procedures in physician offices and independent imaging centers.
The study, conducted by Arlington, VA-based healthcare policy research consulting firm the Moran Company, analyzed the cost of performing imaging procedures in independent imaging centers against proposed DRA reimbursement levels. In addition, the company compared 2006 payment rates for imaging center services to similar services in the outpatient hospital setting.
"When payments for imaging services are compared across sites of care, volume-weighted (using 2004 data) payments in the office are slightly higher, by 0.6%, when weighting is done by the volume of procedures performed in the office," the report authors wrote. "When volume is weighted by the volumes performed in the outpatient hospital setting, however, Medicare Physician Fee Schedule (MPFS) payments are 2.9% below Outpatient Prospective Payment System (OPPS) levels prior to the implementation of the DRA."
Under the DRA provisions, reimbursement rates for imaging services provided in independent imaging centers would equal the lesser of the amount provided under the MPFS or the amount payable to hospitals under the OPPS. On the basis of its data analysis, the report authors believe that there is currently no bias toward higher payments in one setting as compared with the other.
"Once the DRA caps are implemented, however, imaging reimbursement in the office would be materially lower, perhaps by 16% to 18%, than in the (hospital) outpatient setting," they wrote.
The study also examined 524 current procedure terminology (CPT) and healthcare common procedure coding system (HCPCS) codes, which have associated technical component modifiers, related to diagnostic imaging. It identified 145 codes affected by the DRA reimbursement cuts and found that 126 procedures (87%) would be paid at a rate below the cost estimated by the authors for performing them in an independent imaging center.
According to AMIC executive director Tim Trysla, in a press conference yesterday morning, the proposed cuts will change how, where, and if Medicare patients will receive imaging services.
"You cannot cut MRI of the brain by 49%, ultrasound for prostate cancer by 72%, or CT for abdominal aortic aneurysms by 52%, without affecting patients," he said.
Former Centers for Medicare and Medicaid Services (CMS) administrator Tom Scully, now senior counsel for the Washington, DC-based law firm of Alston & Bird, offered a frank assessment of the DRA imaging reimbursement cuts during the press conference.
"Essentially, when Congress had an offset for the stabilization fund that they were planning on using to fund the DRA policies last winter drop out from a political fight at the end of last year, they needed a different offset for the cash to fund the policy and there weren't too many places to find $8.1 billion," he said. "There were no hearings, there were no real serious background discussions of the policy, and I think it's a little surprising how they did it. I think it was sloppy policy at best; I think most serious policy people think this was a half-baked thing that was done without a lot of thought."
Nancy-Ann DeParle, also a former CMS administrator and now with the private equity firm of JP Morgan Partners in Washington, DC, agreed with Scully's appraisal of the DRA.
"This is just a textbook case of how not to do healthcare policy," she said. "You don't just reach into a very elaborately constructed fee-schedule system, the RBRVS (resource-based relative value scale), and pick out one service, pull it out, and start treating it differently. If you want to deal with inappropriate utilization, if you want to deal with quality, that's what we should be talking about; we should figure out what policies deal with that, not come up with this slash-and-burn approach at the last minute."
By Jonathan S. Batchelor
AuntMinnie.com staff writer
September 19, 2006
Related Reading
Revenue cycle review helps imaging centers face challenges to come, August 25, 2006
Reassignment rule proposal offers mixed bag for imaging, August 18, 2006
DRA cuts affect more than imaging providers, August 2, 2006
House bill seeks to delay DRA imaging cuts, June 29, 2006
DRA 2005 in practice: Where the rubber meets the road, April 27, 2005
Copyright © 2006 AuntMinnie.com
