Lobbyists fight for adequate contrast reimbursement
In November, the medical imaging community breathed a sigh of relief when industry advocates persuaded the Health Care Financing Administration to postpone cuts in technical reimbursement for outpatient studies at independent imaging centers (SCAN 11/25/98). But as lobby groups continue to study proposed reimbursement rules coming out of HCFA, they are discovering more and more regulations that, if finalized, could dramatically affect both how radiology is practiced in the U.S. and sales of medical imaging contrast and equipment.
The latest regulatory skirmish affects contrast manufacturers and arises out of a rule published Sept. 2 in the Federal Register stating that HCFA will pay a flat rate for the technical component of any hospital-based outpatient imaging procedure, whether it requires contrast media or not.
In the last decade, HCFA has explored the idea of managing outpatient reimbursements with a system similar to the diagnosis-related groups (DRGs) schedule it has used for inpatient services. HCFA's prospective payment methodology applies what it calls an ambulatory patient classification (APC) schedule to outpatient services. APCs are the agency's attempt to move Medicare's payment base from a fee-for-service method to bundled reimbursements.
To this end, HCFA has been pursuing a strategy of changing both independent and hospital-based outpatient imaging reimbursement protocols. In June, the agency proposed that Medicare payments for the technical component of independent imaging center tests be cut 24% over a four-year period and physician's professional fees be cut 8% to 10%. The industry won a reprieve on this rule last November when HCFA decided to postpone through 2000 the proposed technical component cuts. Professional component cuts of roughly 8% went into effect Jan. 1 of this year, however.
Although delaying technical cuts at freestanding centers was a key victory, lobbyists were acutely aware that the battle wasn't over: In September, HCFA published a rule that dealt with the hospital-based side of the outpatient care equation, setting flat payment rates for hospital outpatient procedures. The rule could affect payments for more than 40 million contrast-enhanced imaging procedures performed each year in the U.S. Groups like the National Coalition for Quality Diagnostic Imaging Services (NCQDIS), the American College of Radiology (ACR), the American Hospital Association (AHA), and the newly formed Medical Imaging Contrast Agents Association (MICAA) are concerned about how this rule will affect contrast media use and reimbursement.
No separate reimbursement for contrast? HCFA's existing reimbursement policy allows hospitals to bill the agency separately for the purchase price of contrast agents used in an imaging exam, if a patient meets certain medical criteria. With the exception of chemotherapy agents, the September rule doesn't include any separate APC codes for drug and equipment supplies associated with a scan, including contrast agents and radiopharmaceuticals. Instead, the guideline proposes an overall flat rate for technical fees of any hospital-based imaging procedure.
Industry analysts believe HCFA's APC codes will prove financially insupportable to hospital-based outpatient centers. For example, the rule proposes that the total allowance for the technical component of an MRI exam be about $403, even though MR exams can cost as much as $1000, depending on the scan. Hospitals that choose not to pass along increased costs to patients will be faced with operating-cost deficits. If contrast agents aren't reimbursed adequately, hospitals and their physicians won't be inclined to use them, which could affect the quality of patient care, according to Dr. Val Runge, Rosenbaum professor of diagnostic radiology at the University of Kentucky in Lexington.
