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Imaging recommendations could cause reinbursement problems

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Rebecca C. Jernigan,

President Obama and the Medicare Payment Advisory Commission (MedPAC) have made their recommendation about Medicare’s formula for calculating the reimbursement rate for medical imaging procedures. Their attempt at cost cutting, however, may have more of an impact than intended.

The Centers for Medicare and Medicaid Services currently assumes that imaging equipment is in use, on average, 50 percent of the time that a medical facility is open. This supposition is used to calculate the amount of money that a facility should be reimbursed for each procedure. The president suggests a 95 percent assumed usage rate for advanced imaging equipment, while MedPAC recommends 90 percent for machinery costing more than $1 million, either of which would cut reimbursements almost in half.

The recommendations are based on a survey performed by MedPAC, which investigated the usage rates of magnetic resonance and computed tomography imaging by 80 providers operating in six urban areas in 2003. The providers also supplied information about the amount of time their systems were in use in 2005, prior to cuts that resulted from the Deficit Reduction Act of 2005. During a meeting in 2006, MedPAC stated that the survey was created solely as a first step in the process and was not intended to determine national equipment-use rates.

iStock.jpgThe impact of these potential cuts would combine with payment reductions in other areas of medical treatment. “Practice expense has large cuts also included. With this, combined with the potential utilization change, a 40 percent reduction in total reimbursement could be seen,” said Tim Trysla, executive director of the Access to Medical Imaging Coalition (AMIC). He said the dramatic reduction would hurt medical facilities already struggling under the increased percentage of uninsured people requiring treatment and would reduce the quality of treatment if medical personnel avoid performing tests and scans because of cost.

To examine the current imaging system usage rates, the Radiology Business Management Association performed its own study, as requested by AMIC. Gathering data from 261 imaging machines in 46 centers, both rural and urban, investigators used current Medicare assumptions to determine the amount of time equipment was being used. According to their calculations, imaging devices in rural locations are used during about 48 percent of available office hours, while in urban areas, the number is about 56 percent. These are close to the current Medicare rates but nowhere near the new recommendations.

Trysla believes that the Obama administration should direct the US Department of Health and Human Services to collect data from equipment scanning logs – which record the length of time a machine is in use – to get a closer estimate of current imaging system usage.

In the meantime, he said, instituting appropriateness criteria, accreditation and physician feedback systems could reduce the costs and promote the proper usage of imaging technologies without having such a dramatic impact on patients.

Sep 2009
Access to Medical Imaging CoalitionAMICBiophotonicsCenters for Medicare and Medicaid Servicescomputed tomographyDeficit Reduction Act of 2005imagingindustrialJerniganmagnetic resonancemedical imagingMedicareMedicare Payment Advisory CommissionMedPACNews & FeaturesPresident ObamaRadiology Business Management AssociationRebecca C. Jerniganreimbursement rateTim TryslaUS Department of Health and Human Services

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