Moran Report: Nearly Nine out of 10 Imaging Procedures Affected by DRA Cuts Would Be Reimbursed Below Cost of Providing the Exam
Eighty-seven percent of procedures subject to Deficit Reduction Act (DRA) imaging cuts (for which current data exists) would be reimbursed at a rate below what it costs physicians to provide the exam (in the in-office setting) according to a Moran Company report released today. For some procedures, the report found that Medicare would reimburse providers less than 20 percent of the cost of providing the service.
“This report illustrates how extreme, far reaching, and ill-advised the DRA imaging cuts are. Many physicians may be unable to provide imaging services to Medicare patients when, for nearly 90 percent of services affected, reimbursement does not even cover the cost of providing the care,” said Arl Van Moore, MD, FACR, chair of the American College of Radiology (ACR) Board of Chancellors. “If the DRA cuts go through, Medicare beneficiaries, particularly in rural areas, may be forced to endure increased wait and travel times to receive imaging services and possibly higher copayments in the outpatient setting.”
The Moran report used Medicare claims data and 2006 payment rates from the Centers for Medicare and Medicaid Services (CMS) Physician Fee Schedule and Hospital Outpatient Payment System (HOPPS) to make cross-site spending comparisons and to assess the DRA reductions in relation to the costs of performing the procedures. It also factored in the expected volume in both the physician-office and hospital outpatient settings. The analysis did not take into account proposed CMS changes in the physician fee schedule or the hospital outpatient payment system for 2007.
Other Key findings of the Moran Report:
• Overall imaging spending in HOPPS and Medicare Physician Fee Schedule (MPFS) systems is now virtually identical (prior to DRA) contradicting the view that the physician fee schedule provided excessive payments compared to the hospital outpatient payment system.
• Once the DRA caps are implemented, imaging reimbursement in the office is estimated, in the aggregate, at 16 percent to 18 percent less than in the hospital outpatient department.
The DRA, passed by Congress in February, without input from imaging stakeholders or patient groups, arbitrarily capped the technical component reimbursement for physician office imaging to the lesser of the Hospital Outpatient Prospective Payment System or Medicare Fee Schedule payment, slashing reimbursement by up to 50 percent for many life-saving technologies, such as CT angiography (CTA) and brain or spine MRI.
The Moran report is the first in-depth analysis of the impact to providers (and ultimately patients) of the DRA imaging cuts. In a July 18 House Energy and Commerce Health Subcommittee hearing on imaging, Herb Kuhn, CMS director of Medicare Management and Medicare Payment Advisory Commission (MedPAC) Chairman, Glenn Hackbarth, revealed that their respective agencies had neither proposed the DRA cuts nor evaluated the potential consequences for patients or providers.
“It is astounding that cuts of this size were included in the DRA without any analysis of their impact on patient care. This report shows that the DRA provisions focus on procedures that Medicare patients often need, such as in the diagnosis and treatment of brain cancer, heart problems, and osteoporosis. As a physician for more than 20 years, I do not understand how those in Congress did not think that cuts this large would adversely affect patient care and did not find it necessary to seek the input of experts in this field,” said Moore.
“This report illustrates the damage that these cuts will do if allowed to go into effect on January 1. Congress should do the right thing for our patients and their constituents immediately and pass the Access to Medicare Imaging Act (HR 5704 and S. 3795) which calls for a delay in these cuts pending a comprehensive analysis by the Government Accountability Office (GAO),” Moore added.
In order to educate Congress and other governmental bodies on the detrimental effects of these cuts, the ACR has joined a broad coalition of patient advocacy groups, medical manufacturers, and providers to form the Access to Medical Imaging Coalition (AMIC). AMIC represents more than 75,000 physicians, providers, and patients, as well as medical imaging manufacturers who employ tens of thousands of workers.
Click here to read the Moran report in its entirety.
For more information regarding ACR efforts to counter drastic imaging cuts contained in the Deficit Reduction Act of 2005, please visit the DRA section of the ACR Web site at http://www.acr.org/s_acr/doc.asp?CID=2537&DID=23825.
