ACR Bulletin

Covering topics relevant to the practice of radiology

Radiology and Medicare Part B: The Fight for Due Compensation

In this excerpt from an ACR Bulletin podcast, William T. Thorwarth Jr., MD, FACR, and Donald F. Lavanty, JD, look back at an important moment in radiology history as they get ready to celebrate the College's centennial year. 
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Because of this success and the ACR's continued advocacy, it's been an entirely different world for radiologists.

—William T. Thorwarth Jr., MD, FACR
April 20, 2023

The ACR is set to begin its centennial celebration at ACR 2023, looking back at a century of accomplishments for radiologists and the specialty. One landmark victory for the profession was when the ACR, led by its first lobbyist, J.T. Rutherford, successfully advocated for radiology services to be covered in Medicare Part B, ensuring the specialty’s place in the evolving American health system. In a new ACR Bulletin podcast, William T. Thorwarth Jr., MD, FACR, ACR CEO, and Donald F. Lavanty, JD, professor of healthcare management and legal studies in the College of Business Innovation Leadership and Technology at Marymount University and the College’s former principal legislative consultant, look back at the historic moment and how it changed the field of radiology forever. This interview has been edited for length and clarity.

Can you provide some context as to where radiology stood in the early to mid-1960s on the eve of Congress passing historic legislation that would come to be known as Medicare?

WT: The College had long been involved in relationships between radiologists and hospitals, and between radiologists and insurance companies. This was nothing new to us. But the governmental
involvement into healthcare was a whole new sphere. Prior to Medicare, radiologists largely were hospital-based and were paid a percentage of the hospital billings collected. Negotiations between hospitals and insurance companies were conducted with very little input from radiologists. For the few independent outpatient facilities that existed at the time, the ACR had developed a relative value system back in 1957. Some of them used that system, but many just established their own fee schedules.

As the possibility of a government-run healthcare system grew more and more likely, radiologists — particularly the ACR — became increasingly involved. Part A of Medicare pays for hospital services, and Part B of Medicare pays for physician services. The goal of the College was to make sure radiologists were treated like all other physicians in Part B.

DL: Radiologists were really concerned about how the specialty would fit in. Radiologists wanted to maintain their independence as private physicians. The Congressional bills that were being floated in the Johnson Administration pretty much indicated an inclination to consider services from radiologists, anesthesiologists and pathologists (infamously abbreviated to RAPs) as part of hospital reimbursement under Medicare Part A. Radiology leaders realized this was not going to work for them, so they decided they needed to do something.

How did the radiology community respond?

DL: The AMA told the radiology leaders, “We’re so busy fighting all of Medicare, you all are going to have to do something on your own. We just can’t help you.” As a result, ACR leadership decided to lobby against the RAPS plan. The AMA suggested J.T. Rutherford, a former member of Congress from Texas. Rutherford was the ACR’s first lobbyist, whose sole purpose was to represent the interests of radiologists in this critical sea change that was about to occur in medicine and reimbursement.

Rutherford opted not to focus on the Senate Finance Committee, which was notoriously pro-hospital, and instead sought out a radiologist with connections to Congressman Wilbur Mills, the chair of the House Ways and Means Committee. Rutherford found a radiologist in Searcy, Arkansas, Wallace Buchanan, MD, who was acquainted with Mills. Buchanan came to Washington to meet with Mills, essentially saying, “Look, Mr. Chairman, we don’t want to be part of the hospital. We want to be treated like doctors, like everybody else.” Mills indicated he would be willing to at least consider that, but they had to get the White House on board.

J.T. Rutherford made a huge difference because of his connections. Talk about how that worked.

DL: Rutherford asked Congressman Mills, “And how do I deal with Senator Russell Long, who isn’t helping our cause?” That’s where Rutherford really showed his prowess. He went across the Capitol to the Senate. The person who really was in charge of Medicare was Senator Clinton Anderson from New Mexico — and Rutherford knew Senator Russell Long would listen to him. (When Rutherford was in Congress on the House Interior Committee, he had helped Senator Anderson get the project he wanted done in New Mexico. He and Senator Anderson worked very well together.)

Looking to the future of medicine, radiologists wanted to be treated like every other doctor, not as a portable hospital community and not as an entity owned by the hospital.

—Donald F. Lavanty,JD

What was your take on what they called National Hospital Insurance at the time? Why was Medicare so opposed to this? And how did that opposition affect radiology directly?

DL: When insurance first came into the healthcare system during the labor movement, some state legislators opposed health insurance being paid for as a condition of employment under the labor-management relationship. Why? Because they felt like for-profit insurance companies would be in control of doctor reimbursement. In response, we saw legislatures allowing not-for-profit entities to provide insurance called Blue Cross Blue Shield. So, from there, the mindset was the same when we came into Medicare. Medical doctors said, “Here we go again. We’re going to allow the government now to control all our payment and our prices.” And so, realistically, that was a very frightening thing for the entire medical community — as well it should have been. Looking to the future of medicine, radiologists wanted to be treated like every other doctor, not as a portable hospital community and not as an entity owned by the hospital. They wanted to be independent and treated like
every other physician that Medicare Part B covered.

WT: Although the ACR participated as a consultant to many government agencies in our areas of expertise, this was really the first time that the leadership formalized a legislative advocacy effort and put the College’s resources behind it. It wasn’t that the ACR was promoting the adoption of Medicare. We were trying to be sure our role was recognized in whatever system was implemented. Because we could see which direction the winds were moving.

You’ve talked a little bit about House Ways and Means Committee and choosing your battles. Can you draw that out more?

DL: The opposition we had was from the Senate Finance Committee, which was saying, “Look, the cost of healthcare is going to increase because radiological procedures are so high and we’re not going to have control over them if they are not treated as part of the hospital and are instead put under Part B.” We told the committee that we were assured the ACR leadership would work to educate its members to charge under Part B and not be a part of any revenue-sharing arrangements with the hospitals.

The committee gave us the benefit of the “political doubt” but made it clear if radiologists were in sharing arrangements, they would work to put them under Part A. By 1972, the Senate Finance Committee called to say several hospital-based physicians (mostly pathology) were in sharing arrangements. (A few were radiologists.) The Senate Finance Committee then moved to propose legislation to outlaw any revenue-sharing arrangements. At this point, the College leadership moved to have the BOC pass a resolution urging that all revenue-sharing cease and radiologists charge under Part B. While the House Ways and Means Committee’s provision was accepted by the Senate Finance Committee, they made it clear we would be closely watched. The College’s action on the resolution passed in 1972 showed that radiology kept its word, and we became a trusted partner for further legislation.

Where would the field of radiology be today if the College hadn’t advocated to get radiology into Medicare Part B?

WT: There’s no question that this was a huge turning point. Diagnostic radiology, radiation oncology and IR would not have advanced at anywhere near the pace we’ve seen since 1965. Our destiny would have been at the whim of the hospitals and their administrators, who generally are not a terribly innovative group. This victory also allowed radiologists to become active in major funding agencies for research such as the National Institutes of Health and then of course in establishing the National Institute of Biomedical Imaging and Bioengineering. Because of this success and the ACR’s continued advocacy, it’s been an entirely different world for radiologists.

Author Interview by Chris Hobson, senior communications manager, and transcription by Alexander Utano, editorial assistant, ACR Press