Self-Referral is a Problem – But Not How You’ve Been Told
Posted on Mon, Feb 21, 2011 @ 11:16 AM
MedPAC, the advisory board to CMS/Medicare, is meeting February 23rd to discuss all manner of issues related to neurologist and neuroimaging. Specifically to be discussed will be the concept of physician owned imaging facilities, and by extension the entire issue of physician self-referral of high end imaging studies. MedPAC is asking for your input but get the facts first and then follow the link at the end to make your voice heard.
The Reality:
Hospitals spend about 50% of the healthcare dollar.
They are acquiring independent medical practices in an attempt to protect that market share, and make sure expensive procedures are done at their facilities. Physicians thus employed are paid nearly twice what non-hospital owned physicians are paid for the same services.
Hospitals have exclusive and exclusionary contracts with physicians and physician groups, thus stifling competition between and among healthcare providers. For instance, many neurologists are trained to interpret MRI's, but are excluded from hospital contracts because the hospitals have exclusive contracts with radiology groups. So the only way these neurologists, who actually take care of patients, can safeguard the quality of imaging for their patients, is by owning the imaging facilities
themselves. This goes for cardiologists, orthopedists, and a number of other physician specialties. It also goes for large family practice groups.
This has been termed “self-referral,” as though that were a bad thing. There is considerable modern evidence to show that this so-called self-referral does not lead to overutilization. The Stark laws carefully control physician ownership in outpatient imaging facilities. In fact, such ownership leads to competition with expensive hospital-owned facilities. Speaking of MRI testing, an MRI in an outpatient testing facility is one-third the cost of the same exam in a hospital-owned facility.
The bogeyman of self-referral is just that.
- When hospital-owned physicians and surgeons refer to hospital-owned facilities… that is self-referral.
- When radiology-owned or contracted physicians recommend other tests be done at those facilities… that is self-referral.
- When a hospital-employed emergency room physician orders CT scans and MRI’s to be done in the hospital… that is self-referral.
In fact, self-interested radiologists, who are among the middle
men of medicine and don’t actually see patients, have used outdated and flawed studies to shift the focus of MedPAC from the lion’s share of the healthcare budget (50% spent by hospitals with exclusive radiology contracts) to a minuscule share of the healthcare budget (<0.5% spent on outpatient MRI), for their own self-interest.
So I would suggest MedPAC focus on the true cost-drivers of medical care delivery, rather than the small and insignificant cost drivers. Hospitals spend more than $30 billion a year, with more in the pipeline, in an arms race of building programs and unnecessary equipment purchases. Hospital costs should be the target of MedPAC- focused reductions.
- Vernon Rowe, MD, UCNS Certified, Neurimaging and Fellow, American Academy of Neurology