Much of the healthcare savings attributed to the use of radiology benefits managers (RBMs) are swallowed up by fees, while other "savings" may in fact simply be the shifting of healthcare costs to physicians, according to a study in the June issue of the Journal of the American College of Radiology.
The study's findings add further fuel to the national debate about how exactly to reduce healthcare costs. Organizations such as the U.S. Government Accountability Office (GAO), the Congressional Budget Office (CBO), and the Medicare Payment Advisory Commission (MedPAC) have all suggested that RBMs be used to manage costs.
And in May, a study commissioned by Magellan Health Services suggested that Medicare and its beneficiaries could save $13 billion to $24 billion between now and 2020 if radiology benefits management programs were adopted.
In theory, RBMs help insurers manage imaging costs through various mechanisms, including denying coverage, diverting patients to less expensive imaging services, and educating physicians about appropriate imaging. But little has been done to identify the hidden costs of implementing RBMs, according to lead study author David Lee, PhD, head of health economics for GE Healthcare. GE funded the study.
"RBMs are widely used by private payors to manage the utilization of imaging services through prior authorization, and they have been proposed for use in the Medicare program," Lee said. "[But] despite their popularity among private insurers, little is actually known about the short-term or long-term impact of RBMs on the utilization of imaging services or healthcare costs."
Lee and colleagues created a framework for evaluating the impact of key parameters (such as such as physician and staff time or patient experience as the result of delay or denial of an imaging test) on the ability of RBMs to lower costs, and used decision-analytic modeling to simulate the net impact of RBMs on healthcare costs (JACR, June 2011, Vol. 8:6, pp. 393-401).
The team created a model of a "typical" RBM's prior authorization process and used base-case values for each parameter drawn from published data and the experience of a large, academic institution -- simulating a private health plan with 100,000 members and an annual imaging utilization rate of 135 scans per 1,000 members.
Under this framework, RBMs were projected to achieve cost savings of $640,263 within the private health plan through a 12.5% reduction in imaging utilization. But the model also predicted that these costs savings were offset by RBM fees of $458,197, as well as costs of $182,066 to physicians and their staff members who expended resources complying with RBM procedures.
Bottom line? The model suggested approximately 28% ($182,066 out of $640,263) of the total projected savings provided by an RBM are shifted to providers.
It's telling that those who are making pro-RBM recommendations aren't necessarily considering the broader, system-wide effect, Lee said.
"We were surprised at the magnitude of cost shifting we found in our simulations," Lee told AuntMinnie.com. "And this cost shifting creates scenarios in which RBMs are providing savings from the perspective of the health plan but are actually increasing costs to the healthcare system overall."
In fact, Lee's study found that in 45% of the simulations from the study model, RBMs reduced costs, while in 55% of the simulations, RBMs actually increased costs.
"The evidence on RBMs' ability to reduce costs is thin," Lee said. "And there's no way to measure the intangible costs that could result from an RBM model. Suppose the RBM is wrong, and it denies appropriate imaging service? What happens to the patient then?"
Most physicians part company with governmental decision-makers and private payors on the topic of RBMs' effectiveness, according to Lee. They believe that treatment decisions should ultimately remain in the hands of physicians and patients, with the guidance of evidence-based appropriateness criteria.
"Providers can mitigate the cost shift caused by RBMs by proactively working to ensure that imaging study orders are appropriate," Lee said. "The radiology community can assist in this effort by continuing to improve and expand ACR Appropriateness Criteria so that physicians who order imaging studies will have better information to guide their decisions, and radiologists can work locally to ensure that appropriate imaging occurs in their communities."
