Talking Points


The following outlines the serious concerns the American College of Radiology (ACR) has with Congress's decision in the final hours of the negotiations on the Budget Reconciliation Conference Report to include significant and arbitrary cuts (30% to 80%) in the Medicare payments for medical imaging procedures performed in a physicians' office. Such cuts were not included in either the Senate or House passed versions of Budget Reconciliation nor were they ever recommended by the Medicare Payment Advisory Committee (MedPAC).

The ACR, representing over 30,000 radiologists across the United States, has worked for the past 18 months to highlight the need to address the rising cost of medical imaging to the Medicare program by promoting the recommendations of MedPAC. These recommendations include looking to many of the cost containment strategies currently being implemented in the private sector to reduce unnecessary and poor quality medical imaging procedures. As part of this effort ACR has strongly opposed the implementation of arbitrary across the board cuts, which fail to address the root causes of the increased growth in Medicare spending on medical imaging.

The Deficit Reduction Act of 2005 (S. CONF. REP. NO. 109-362), as amended, included language that calls for significant payment cuts (to take effect on January 1, 2007) in the technical component payment for all imaging services performed in the physician office setting. The technical component payment covers practices expenses including clinical staff time, supplies, and equipment. This payment typically represents as much as 70% of the overall payment for the medical imaging procedure.

This new policy, which caps reimbursement for the technical component for physician office imaging at the lesser of the Hospital Outpatient Prospective Payment or the Medicare Fee Schedule Payment, affects all physicians, regardless of specialty, yet disproportionately impacts radiologists those best trained to perform such procedures. The savings from this cut equal 44% of the overall net savings achieved in the entire Medicare section of the Budget Reconciliation Conference Report. ACR believes that this is a disproportionate and unfair burden for one medical specialty to be saddled with.

Quality of Care Impact

  • Limited Access: It is a simple fact that some radiologist facing cuts of 20% to 30% in Medicare payments will no longer be able to afford to perform medical imaging procedures in their offices. This will affect patient access to medical imaging especially rural settings.
  • Mammography Access: As radiology practices make difficult business decisions on what procedures they will be able to continue to offer as a result of these drastic cuts, the availability of low, or no, profit procedures such as mammography may be drastically reduced or even dropped altogether. Since the majority of these services are provided in the office setting rather than the hospital, timely access, which is critical to the fight against breast cancer, may be severely compromised.
  • New Technology: For those imaging practices that remain open, their ability to afford the latest in imaging technology will be severely compromised. A declining market for innovative equipment will cause a research and development freeze, which will not only harm equipment manufacturers, but also severely affect access of Medicare beneficiaries to the latest in medical technology.
  • Rural Access: Radiologists practicing in rural areas with low volumes of patients are less able to absorb 20% to 30% cuts in payment. Many will be forced to close their practices in rural locations causing many Medicare beneficiaries to travel long distances to hospitals for imaging services or forgo these services altogether
  • Cancer Treatment: As written the provision will potentially reduce payments to radiation oncologists who use medical imaging procedures for radiation treatment planning. Such cuts in payment could limit access or cause many cancer patients to travel longer distances to receive their cancer treatment.

Financial Impact on Radiology

  • Based on Congressional Budget Offices (CBO) estimates, the specialty of radiology will essentially absorb more than 38% of the offset for the costs for the physician payment freeze ($7.3 billion) also included in this legislation.
  • Preliminary analysis of this provision by ACR shows that CBO has severely underestimated the financial impact of this policy. Our analysis shows that the impact of these cuts over a five year period will be twice what CBO estimated ($6 billion vs. $2.8 billion as estimated by CBO).

Objections to Congressional Budget Process

  • The proposal to cut Medicare payments to medical imaging procedures was neither included in the Senate or House passed versions of the Budget Reconciliation legislation nor were they ever the subject of a Congressional Committee hearing or recommended by MedPAC.
  • The proposal to arbitrarily cut Medicare payments to medical imaging procedures was concocted during the final hours of negotiations on the Budget Reconciliation Conference Report by a small insulated group of lawmakers who did not consult with any of the constituencies that would be affected by such a proposal. Instead of working with physicians to address the root cause of increased Medicare spending on medical imaging and stabilize utilization volume by improving quality in diagnostic medical imaging services, lawmakers simply sought to impose an arbitrary and unfair policy to plug a gap in the savings needed to be produced in the final bill.
  • Throughout the year, ACR maintained a constant good-faith dialogue with the appropriate jurisdictional committees regarding an imaging policy supported by MedPAC and based on the implementation of quality and safety standards that would have also saved Medicare considerable money.
  • A large segment of imaging reimbursement will now be based on an entirely different payment methodology (RBRVS vs. HOPPS) without appropriate analysis, congressional hearings, or consideration by the relevant stakeholders and researchers. This haphazard movement from a well-established system sets an unwise precedent not only for imaging, but also for medicine as a whole.
  • Congress ignored the recommendations of MedPAC to address both cost and quality issues in diagnostic medical imaging services and in an extremely shortsighted move chose to address just cost with no attempt to address the more important issue of quality.