Examining Drivers of Health Care Spending: Evidence on Self-referral Among a Privately Insured Population.

BACKGROUND: Despite the enactment of laws to restrict the practice of self-referral, exceptions in these prohibitions have enabled these arrangements to persist and proliferate. Most research documenting the effects of self-referral arrangements analyzed claims records from Medicare beneficiaries. Empirical evidence documenting the effects of self-referral on use of services and spending incurred by persons with private insurance is sparse. OBJECTIVES: We analyzed health insurance claims records from a large private insurer in Texas to evaluate the effects of physician self-referral arrangements involving physical therapy on the treatment of patients with frozen shoulder syndrome, elbow tendinopathy or tendinitis, and patellofemoral pain syndrome. STUDY DESIGN: We used regression analysis to evaluate the effects of episode self-referral status on: (1) initiation of physical therapy; (2) physical therapy visits and services for those who had at least 1 visit; and (3) total condition-related insurer allowed amounts per episode. RESULTS: For all 3 conditions, we found that patients treated by physician owners were much more likely to be referred for a course of physical therapy when compared with patients seen by physician nonowners. A consistent pattern emerged among patients who had at least 1 physical therapy visit; non-self-referred episodes included more physical therapy visits, and more physical therapy services per episode in comparison with episodes classified as self-referral. Most self-referred episodes were short and the initial visit did not include an evaluation. CONCLUSION: Physician owners of physical therapy services refer significantly higher percentages of patients to physical therapy and many are equivocal cases.

Dramatically increased musculoskeletal ultrasound utilization from 2000 to 2009, especially by podiatrists in private offices.

PURPOSE: Over the past two decades, musculoskeletal (MSK) ultrasound has emerged as an effective means of diagnosing MSK pathologies. However, some insurance providers have expressed concern about increased MSK ultrasound utilization, possibly facilitated by the low cost and ready availability of ultrasound technology. The purpose of this study was to document trends in MSK ultrasound utilization from 2000 to 2009 within the Medicare population. METHODS: Source data were obtained from the CMS Physician/Supplier Procedure Summary Master Files from 2000 to 2009, and records were extracted for procedures for extremity nonvascular ultrasound. We analyzed annual volume by provider type using specialties, practice settings, and geographic regions where the studies were performed. RESULTS: In 2000, Medicare reimbursed 56,254 MSK ultrasound studies, which increased to 233,964 in 2009 (+316%). Radiologists performed the largest number of MSK ultrasound studies in 2009, 91,022, an increase from 40,877 in 2000. Podiatrists utilized the next highest number of studies in 2009, 76,332, an increase from 3,920 in 2000. Overall, private office MSK ultrasound procedures increased from 19,372 in 2000 to 158,351 in 2009 (+717%). In 2009, podiatrists performed the largest number of private office procedures (75,544) and accounted for 51.5% of the total private office growth from 2000 to 2009. Radiologist private office procedures totaled 19,894 in 2009, accounting for 9.2% of the total private office MSK ultrasound growth. CONCLUSIONS: The MSK ultrasound volume increase among nonradiologists, especially podiatrists, was far higher than that among radiologists from 2000 and 2009, with the highest growth in private offices. These findings raise concern for self-referral.

Self-referral in medical imaging: a meta-analysis of the literature.

PURPOSE: In the current political and economic climate, there is a desire to reduce health care costs; diagnostic imaging expenditure is one area of particular interest. The authors present a meta-analysis of the relative frequency of imaging utilization in the setting of self-referral compared with that of non-self-referral and a simulation of increased cost to Medicare Part B on the basis of this relative frequency. METHODS: The MEDLINE database was searched systematically. Specific inclusion criteria for relative frequency calculations were a numerator (number of patients imaged) and denominator (number of total patients seen) in each group (self-referrers and radiologist referrers). The relative risk of self-referral was determined for each group and is defined by the "relative frequency" of imaging utilization for the self-referrers divided by the frequency for the radiologist referrers. Relative frequency represents the increased (if >1) or decreased (if <1) chance of imaging by self-referrers over radiologist referrers. The meta-analysis was used to combine imaging frequencies for each referral condition of the individual studies that met inclusion criteria for an overall estimate of relative frequency, using a random-effects model to account for the variations among the studies. Relative frequency data were then used to perform a cost simulation to Medicare Part B using 2006 data. RESULTS: The initial search yielded 334 articles, 5 of which met the threshold for inclusion. In these 5 studies, 76,905,162 total episodes of care were analyzed. The individual relative frequency of imaging in the setting of self-referral ranged from 1.60 to 4.50. The combined relative frequency was 2.16 (95% confidence interval, 2.15-2.16) using the fixed-effects model and 2.48 (95% confidence interval, 1.90-3.24) using the random-effects model. For 2006 Government Accountability Office (GAO) data, the estimated cost of increased imaging in the setting of self-referral was $3.6 billion, but a range of costs was also provided to account for potential inaccuracies in the GAO data. CONCLUSIONS: The existing literature yields a combined relative frequency of imaging of 2.48 (95% confidence interval, 1.90-3.24) for self-referrers compared with non-self-referrers. Precise extrapolation of Medicare Part B costs attributable to self-referral would require changes in reporting requirements for imaging equipment ownership. Cost simulation results total billions of dollars annually and may be irrespective of potential inaccuracies in the GAO data as a result of Current Procedural Terminology(®) coding ambiguity and nontransparent reporting of equipment ownership.

Formation of combined urology and radiation oncology practices: objective data from radiation oncologists for rationale.

OBJECTIVES: We sought to determine motivating factors for radiation oncologists to form joint ventures with urologists to provide intensity modulated radiation treatment (IMRT) to prostate cancer patients that the urologists diagnose. METHODS: The American College of Radiation Oncology developed a survey and requested responses from radiation oncologists who had professional relationships with urologists to deliver prostate cancer intensity modulated radiation treatment in a combined practice. Daily patient treatment totals and practice characteristics were queried. To date, there is no actual data to elucidate the motivation of radiation oncologists to form such an association. RESULTS: All 75 respondents indicated that their practice model was a multispecialty group, in which the radiation oncologist has an employment agreement to receive the professional component for radiation treatment services, and was also a financial partner in the technical component. All respondents were economically displaced in a geographic region by existing radiation oncology groups, hospital-based radiation oncology practice, or both. All radiation oncologist respondents stated that they were unable to achieve professional partnership status within a radiation oncology group, and 98.6% were unable to obtain a share of the technical component for radiation treatment. Eighty-six percent of respondents treated patients with nonprostate malignancies in their facility, at a rate of 1.9 times more nonprostate patients than prostate patients. CONCLUSION: This data may indicate that radiation oncologists combine with urologists in a geographic area where the radiation oncologist has been economically displaced, has existing referral patterns, and continues to treat other patients with nonprostate malignancies.

Imaging: the self-referral boom and the ongoing search for effective policies to contain it.

When a physician who isn't a radiologist holds an ownership interest in an advanced imaging machine and refers patients for diagnostic procedures on that machine, this act of self-referral presents a conflict of interest. Numerous studies demonstrate greater use of high-tech imaging when physicians can financially benefit from such referrals. This overview summarizes the issues surrounding imaging self-referral and reviews the history of attempts to control it, as well as options for limiting its impact on spending. Recent payment reductions by Medicare limited the rewards for imaging self-referral, and the Affordable Care Act mandated disclosure of physicians' ownership interests. However, the rewards for imaging self-referral remain strong. Policy makers continue to search for the right mechanisms for containing the practice and for assuring that Medicare beneficiaries receive only medically necessary imaging studies, regardless of who owns or operates the equipment.

Trends in PET scanner ownership and leasing by nonradiologist physicians.

PURPOSE: The aim of this study was to examine growth trends in ownership or leasing of private-office PET scanners by nonradiologist physicians. MATERIALS AND METHODS: The Medicare Part B Physician/Supplier Procedure Summary Master Files for 2002 through 2007 were used to collect the following data for each PET-related Current Procedural Terminology((R)) code: 1) annual procedure volume, 2) places of service for the procedures, and 3) specialties of the physicians filing the claims. To determine ownership or leasing, only technical and global claims that occurred in the nonhospital, private-office setting were included in the study. Professional component-only claims were not included. Procedure volume and growth trends were compared between radiologists and other specialties. RESULTS: Between 2002 and 2007, radiologist-owned Medicare PET scans increased by 259%, whereas nonradiologist-owned or nonradiologist-leased scans grew by 737%. Five specialty groups accounted for 95% of all nonradiologist PET volume in 2007: internal medicine subspecialties (28,324 studies in 2007), medical oncology (14,320 studies), cardiology (13,724 studies), radiation oncology (9,563 studies), and primary care (2,398 studies). In 2002, of all Medicare PET examinations performed on units owned or leased by physicians, the share for nonradiologists was 13%; their share rose to 24% in 2007. CONCLUSION: Although a large percentage of PET scans in private offices are done by radiologists, the growth rate among nonradiologists was far higher between 2002 and 2007 (259% for the former, 737% for the latter). The disproportionately rapid growth of PET scans performed on units owned by nonradiologists raises concern about self-referral at a time when policymakers are struggling to contain costs and reduce radiation exposure.

Self-referral of imaging and increased utilization: some practical perspectives on tackling the dilemma.

Health care costs are higher in the United States than in any other country in the world, and imaging services have been growing much more rapidly than other services. Studies have shown a tendency for increased utilization of services, including imaging services, when referring physicians have ownership interest in the services. In recent years, the CMS has taken some action with respect to how it pays for imaging, including reducing physician payments when multiple images are taken on contiguous body parts during the same visit, establishing a cap on payments for certain imaging services, and imposing an antimarkup rule on diagnostic tests. In addition, CMS has made some changes to the Stark rules, which included adding nuclear medicine to the list of designated health services, prohibiting certain per-service or per-click leasing arrangements, and prohibiting physicians from owning entities that sell services to providers that then bill for them under arrangements. Because it is unclear whether these policy changes will have much effect on imaging utilization, CMS will continue to seek new ways to rein in utilization. In the near future, CMS and the US Department of Health and Human Services are likely to attempt to curb utilization not only through postpayment review and education but also through its various initiatives on improving the quality of services furnished to Medicare benificiaries.

Recent payment and utilization trends in radionuclide myocardial perfusion imaging: comparison between self-referral and referral to radiologists.

PURPOSE: The aim of this study was to examine the effects of self-referral by comparing recent trends in payments and utilization rates for radionuclide myocardial perfusion imaging (MPI) among radiologists and cardiologists between 1998 and 2006. MATERIALS AND METHODS: Nationwide Medicare Part B claims databases for 1998 through 2006 were used. The 4 primary MPI codes were selected. Using Medicare's physician specialty codes, physician providers were identified as radiologists, cardiologists, or other physicians. Payments for MPI to the 3 groups were tracked over the study period. Trends in utilization rates in both hospital and private office settings were also compared among the 3 groups. In addition, utilization trends were studied for related procedures, such as stress echocardiography (SE) and invasive diagnostic coronary angiography (CA). RESULTS: Between 1998 and 2006, Medicare Part B payments to radiologists for MPI increased from $72.6 million to $84.0 million (+16%), while among cardiologists, payments increased from $242.6 million to $972.0 million (+301%). Private office utilization rates per 1,000 Medicare beneficiaries increased by 215% among cardiologists, compared with 32% among radiologists. In hospital settings, the rate changes were much more modest. Hospital utilization rates were consistently higher among radiologists than cardiologists; in hospital settings in 2006, the rate was 15.3 per 1,000 among radiologists, compared with 11.8 per 1,000 among cardiologists. Between 1998 and 2006, the utilization rate for SE among cardiologists increased by 20%, and the rate for diagnostic CA among cardiologists also increased by 20%. CONCLUSION: In recent years, there have been very sharp increases in the costs and utilization of MPI among cardiologists compared with radiologists. Most of the growth occurred in cardiologists' private offices. In hospital settings, radiologists still do more MPI examinations than cardiologists. Because MPI is a highly reimbursed procedure and there is no evidence that coronary disease is increasing in frequency in the Medicare population, this trend raises a concern about inappropriate self-referral. This is particularly true in view of the facts that the utilization of a competing procedure such as SE also continues to increase among cardiologists and that MPI is not substituting for an invasive procedure such as diagnostic CA.

Ownership or leasing of CT scanners by nonradiologist physicians: a rapidly growing trend that raises concern about self-referral.

PURPOSE: The aim of this study was to examine recent nationwide trends in the ownership or leasing of computed tomographic (CT) scanners in private offices by nonradiologist physicians. METHODS AND MATERIALS: The Medicare Part B fee-for-service data sets for 2001 though 2006 were used to identify all CT scans performed in nonhospital, private-office settings. Ownership or leasing of CT scans was determined by tabulating all global and technical-component-only claims. Professional-component claims were excluded. The specialty of the owner or lessee was determined using Medicare's physician specialty codes. Procedure volume trends and growth rates among all nonradiologist physicians as a group were compared with those among radiologists. Individual specialty volume trends and growth rates were also studied. RESULTS: From 2001 to 2006, Medicare private-office CT scan volume in facilities owned by radiologists increased by 85%. CT scan volume in facilities owned or leased by nonradiologist physicians as a group increased by 263%. The nonradiologic specialties with the largest volumes in 2006 were primary care (192,255 scans), internal medicine subspecialties other than cardiology and medical oncology (184,991 scans), urology (125,850 scans), cardiology (104,739 scans), and medical oncology (61,976 scans). Excluding CT scans performed in independent diagnostic testing facilities (for which physician ownership cannot be determined), nonradiologists' private-office CT market share rose from 16% in 2001 to 28% in 2006. CONCLUSIONS: The majority of Medicare private-office CT scans are done in facilities owned by radiologists. However, nonradiologist physicians are acquiring or leasing CT scanners in increasing numbers, and the growth trend is much more rapid among them than it is among radiologists (85% among radiologists from 2001 to 2006, compared with 263% among nonradiologists). As a result, nonradiologists' market share has increased considerably. At a time when both cost containment and reduction in radiation exposure are urgent priorities, the self-referral opportunities resulting from this trend should be of concern to payers and policymakers.

Turf wars in radiology: recent actions against self-referral by state governments, commercial payers, and medicare--hope is on the horizon.

Self-referral in imaging creates a problem for our health care system in that it leads to higher utilization and costs. Although it is still widespread, there are indications that some states, some regional payers, and the Centers for Medicare & Medicaid Services have begun to take some actions to limit this potentially abusive practice. At the state level, these actions include consideration of anti-self-referral laws, crackdowns on scan-leasing schemes, the institution of mandatory facility accreditation programs, and bans on the installation of advanced imaging equipment in physician offices. Some commercial payers have instituted strict privileging programs in imaging, closed their panels to any facility that is not a full-service imaging provider, and begun requiring accreditation of advanced imaging modalities. The Centers for Medicare & Medicaid Services plans to institute an antimarkup rule and prohibit independent diagnostic testing facilities from leasing space or equipment to nonradiologist physicians, and it has indicated that tightening up the loopholes in the Stark laws may be in the offing. In this paper, the authors review all these recent developments and their implications.

The 2005 Robert D. Moreton lecture: the inappropriate utilization of imaging through self-referral.

Self-referral in diagnostic imaging has adverse consequences for our health care system. It inevitably leads to overutilization. If untrained physicians try to interpret images, they will make avoidable errors. Imaging facilities operated by untrained physicians are more likely to produce poor-quality examinations. These statements are backed up by abundant evidence in the medical literature. Major payers such as Medicare and the Blue Cross Blue Shield Association are aware of the problem. There are a number of possible remedies, and it remains to be seen whether they and other payers will adopt them.