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  • Self-referral Spurs Growth in Nonradiologist Imaging

    April 01, 2011

    When the Maryland Supreme Court upheld a state law prohibiting physicians from referring patients for MR imaging, CT and radiation therapy services to providers in their own group practice, it marked a rare victory for opponents of the practice of self-referral.

    The January 2011 ruling marks a setback for the practice that is contributing to significant growth in imaging by non-radiologists, according to recent research from Thomas Jefferson University Hospital in Philadelphia. Tracking the growth in non-radiologist use of imaging equipment over five years, researchers found that Medicare PET scanning performed on equipment owned or leased by non-radiologists grew by a whopping 737 percent between 2002 and 2007, said study co-author David C. Levin, M.D., a professor emeritus at Jefferson Medical College and former chair of the Department of Radiology at Thomas Jefferson University Hospital.

    In a study published in the January 2011 issue of the Journal of the American College of Radiology researchers determined that Medicare payments to non-radiologists for noninvasive medical imaging had recently surpassed those to radiologists, thanks in part to rapid growth in fee-for-service payments to nonradiologists.

    The trend toward non-radiologist imaging is troubling on a number of fronts, Dr. Levin said.

    "When doctors refer patients to a radiologist, they have no financial incentive, so there is relatively little inappropriate imaging," Dr. Levin said. "When physicians such as cardiologists or orthopedists have their own equipment and self-refer, they get more income. That creates a built-in conflict of interest, and that is troubling."

    "If one benefits from a study being performed, then one might be tempted to order more studies," concurred co-author Richard E. Sharpe Jr., M.D., M.B.A., chief radiology resident at Thomas Jefferson University Hospital. "That's the moral hazard in supplier-induced demand. Self-referral also ultimately increases healthcare costs."

    "Radiologists are well compensated, so we're not arguing about the money," Dr. Levin echoed. "This is about saving costs for the healthcare system."

    Lawmakers Yet to Close Stark Loophole

    Ironically, the increase in non-radiologist imaging is rooted in a law originally intended to prohibit self-referral: the Stark law, which barred self-referrals for clinical laboratory, imaging and other health services under Medicare if the referring doctor had a financial interest in the facility. The law had one glaring loophole: an exception allowing physicians to refer tests to themselves or another physician in the same group practice if the equipment is located in their own office.

    Since the Stark law took effect in 1992, manufacturers began aggressively marketing high-tech imaging equipment to nonradiologists. Additional revenue streams from imaging proved attractive to physicians facing stagnating salaries and declining reimbursements.

    "The underlying message we send to physicians is, the more exams you do, the more you get paid," said Alwyn Cassil, director of public affairs for the Center for Studying Health System Change (HSC), an independent, nonpartisan health policy foundation based in Washington, D.C.

    In a recent physician survey, Cassil and HSC colleagues discovered that 22.7 percent of physicians in community-based, physician-owned practices reported their practice owned or leased equipment for X-rays and 17.4 percent possessed equipment for advanced imaging. The survey included information from more than 4,700 physicians and yielded a 62 percent response rate. Since the analysis examined the extent of physician practice ownership or leasing of medical equipment, the sample was limited to 2,750 physicians practic¬ing in community-based, physician-owned practices who represent 58 percent of all physicians surveyed.

    Despite potential drawbacks to excessive imaging—radiation dose remains a headline in mainstream media—and opposition from organized radiology, lawmakers have so far been reluctant to close the loophole in the Stark law. Non-radiologist physician groups have lobbied against any changes and radiologists say a provision added to the 2009 federal Patient Protection & Affordable Care Act, requiring self-referring physicians to disclose financial interest to patients and inform them of nearby imaging facilities, isn't likely to have an impact.

    "That provision is toothless," Dr. Levin said. "Ninety-nine out of 100 patients will trust their doctor and get the exams done in the same office."

    Nonradiologists Drive Musculoskeletal Ultrasound Growth

    One of the biggest growth areas is musculoskeletal ultrasound, promoted as a convenient, inexpensive alternative to MR imaging. In a study presented at RSNA 2010, Thomas Jefferson University researchers analyzed U.S. Centers for Medicare and Medicaid Services data between 2000 and 2008 and found that non-radiologists accounted for 71 percent of the increase in musculoskeletal ultrasound growth. The study showed that 213,425 musculoskeletal ultrasound studies were primarily reimbursed by Medicare in 2008, up from 56,254 exams in 2000. Of the 157,171 increase in exams over that time period, 111,268 were conducted by nonradiologists, researchers found.

    "One of the most shocking findings was that podiatrists performed 66,585 studies in 2008, after performing almost 3,920 in 2000," said Dr. Sharpe, a study author. "In 2008 podiatrists performed three times more exams than other specialties and any other nonradiologist provider type and approached the number of examined performed by radiologists."

    It appears unlikely that payers will wait for new legislation before pushing back against imaging overutilization. In September 2009, Blue Cross Blue Shield issued a new policy in four states deeming all musculoskeletal ultrasound studies "experimental," citing the potential for lack of training and oversight amid the proliferation of diagnostic units. Although the decision was reversed five months later, it is a clear sign of things to come, Dr. Levin said.

    "Payers can set policy versus setting laws," he said. "In Philadelphia, Blue Cross will not pay for high-end imaging in an office unless it's a full-service modality provider. As a result, no cardiology practices in Philadelphia have a CT machine."

    Accreditation, Malpractice Reform Can Reduce Overutilization

    Radiologists are recommending a number of changes, including more vigorous accreditation programs, said Levon Nazarian, M.D., a professor of radiology and vice-chair of education at Thomas Jefferson University Hospital and a member of RSNA's Public Information Advisors network. Dr. Nazarian helped develop a new program at the American Institute of Ultrasound in Medicine that allows nonradiology practices to earn accreditation in musculoskeletal ultrasound.

    "We have to have accreditation programs," Dr. Nazarian said. "Otherwise, how are payers going to know who to pay and who not to pay? I am a board-certified radiologist who works in an accredited ultrasound center, yet I use the same CPT code as a non-radiologist who may not have had proper training."

    Malpractice reform is also central to any effort to reduce unnecessary imaging, Dr. Sharpe said. A recent study conducted at the Children's Hospital of Philadelphia found that approximately one-fifth of CT, MR imaging and other tests ordered by orthopedists are based on the fear of a lawsuit rather than a clinical indication. In the study presented at the American Academy of Orthopedic Surgeons conference in February 2011, 72 surgeons prospectively tracked what imaging studies they ordered—and why—for 2,068 patient exams.

    "Malpractice fears, either real or perceived, create strong incentive to order extra scans," Dr. Sharpe said. "I've heard many doctors say that they will never get faulted for ordering a study, but could get faulted for not ordering one. This helps them justify ordering more studies."

    Other possible changes include moving from fee-for-service payments to value-based alternatives.

    "The big question is, what incentives can we provide to physicians for not imaging?" Cassil said. "We pay doctors to scan, scope and cut, but we don't pay them terribly well to talk with patients."

    Learn More

    To read an abstract of the study, "Medicare Payments for Noninvasive Diagnostic Imaging Are Now Higher to Nonradiologist Physicians Than to Radiologists," in the Journal of the American College of Radiology, click here.

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