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GAO: Self-Referral Costs Medicare Millions

November 5, 2012
Written by: , Filed in: Diagnostic Imaging, Medical Ethics, Practice Management
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When doctors have a financial interest in CT and MRI services, they tend to order more CT and MRI scans.

The General Accountability Office, the investigative agency for Congress, came to that unsurprising conclusion in a report bluntly titled Higher Use of Advanced Imaging Services by Providers Who Self-Refer Costing Medicare Millions. The report recommended that the Centers for Medicare & Medicaid Services (CMS) flag self-referrals on Medicare claim forms, reduce Medicare payments for them, and take steps to ensure the appropriateness of self-referrals.

GAO released the report on Halloween. Associations representing the medical imaging industry and medical groups reacted as if GAO had soaped their windows and TPed their trees.

They probably needn’t worry. The report all but admitted that it will trigger little if any change.

GAO found that physicians “substantially increased their referrals for MRI and CT services” after buying or leasing imaging equipment or joining practices that owned or leased such equipment. The report adds:

This suggests that financial incentives for self-referring providers may be a major factor driving the increase in referrals. These financial incentives likely help explain why, in 2010, providers who self-referred made 400,000 more referrals for advanced imaging services than they would have if they were not self-referring.

You can find the report here.

The Medical Imaging & Technology Alliance issued a statement criticizing the report for not acknowledging that per-capita imaging use has declined in recent years. Gail Rodriguez, PhD, MITA’s executive director, said, “Efforts to limit physicians would threaten patient access to health care providers and technologies while obstructing coordinated care models that have been proven to lower costs and improve care.”

Donald W. Fisher, PhD, president and chief executive officer of the American Medical Group Association, issued a statement saying, in part, “I would strongly urge federal policymakers not to rush to judgment based on a single report. Patients deserve to have access to coordinated care, which is most effectively delivered by multispecialty medical groups and other organized systems of care.”

The report appears to be dead on arrival. The Department of Health and Human Services, which encompasses CMS, rejected the recommendations for a self-referral flag and reduced payment for self-referred imaging.

It did, according to the report, say it would “consider our recommendation that CMS determine and implement an approach to ensure the appropriateness of advanced imaging services referred by self-referring providers.”

GAO apparently doesn’t expect very serious consideration. The report plaintively (or petulantly) says:

On the basis of HHS’s written response to our report, we are concerned that neither HHS nor CMS appears to recognize the need to monitor the self-referral of advanced imaging services on an ongoing basis and determine those services that may be inappropriate, unnecessary, or potentially harmful to beneficiaries.

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Was that campy Reefer Madness movie, which portrayed marijuana as causing innocent teenagers to go insane, actually a documentary? For the straight dope on an MRI-based study that links marijuana use with schizophrenia, see our Facebook page.

Related seminar: The Business of Radiology

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