BCBS Plan is Flawed with Imaging Preauthorization Push

October 20, 2011

While the radiology benefit managers model has shown some benefits in curbing overutilization, most recent research points to a more cost-effective model for imaging: the use of medical appropriateness clinical decision support.

In early October 2011, the Blue Cross Blue Shield Association submitted a proposal to Congress and the U.S. Department of Health and Human Services, saying their approach will save the government more than $300 billion in healthcare costs over the next 10 years. Part of the BCBS’s plan involves requiring preauthorization for advanced imaging.

While estimates vary, a conservative average cost for an advanced imaging procedure is $429. Assuming a typical hospital performs 230 procedures per day (84,000 studies per year,) if just 10 percent of duplicate studies were avoided, nearly $3.6 million could be saved.

It is estimated that more than one third of all medical imaging tests may be medically inappropriate and 20 percent may be unnecessarily duplicative. There is significant merit in attempts to reign in the inappropriateness and duplication that are contributing to cost increases.

One model is radiology benefit management (RBM) companies which staff nurses and physicians who read criteria off a utilization review screen during call center discussions and make decisions to authorize procedures. Interestingly, the burden of the call falls upon the ordering physician, even though that physician is not reimbursed for the study that is being ordered.

In its plan, the BCBSA points to RBM successes in the private sector.

While the RBM model has shown some benefits in curbing overutilization, most recent research points to a more cost-effective model for imaging: the use of medical appropriateness clinical decision support.

According to recent research in the Journal of the American College of Radiology, physicians at a Seattle hospital saved 25 percent on selected imaging procedures by using a clinical decision support (CDS) solution. At a nearby clinic, the number of CT and MRIs dropped by 39 percent over a 22-month period following implementation of an evidence-based, point-of-order CDS solution.

Today, RBM companies manage more than 150 million patients. According to a 2009 Health Affairs article, RBM-based utilization review protocols, denials and appeals processes costs an average of $68,274 per practice, or more than $25 billion annually. This tremendous cost is unnecessary, especially based upon the availability of new electronic appropriateness criteria-driven CDS systems.

Since it is more efficient to make criteria available to physicians directly at the point of care, why shouldn’t technology replace an inefficient and costly middle-man model?

Health reform and ACO development are creating financial incentives to rapidly adopt CDS technology. These solutions will become increasingly important under pre-funding models which reward the most appropriate utilization for the lowest possible cost and the highest possible quality of patient care.

What about Meaningful Use? While Stages 2 and 3 are yet to be solidified, it is believed that Stage 2 will require 60 percent of all radiology orders to go through the hospital’s electronic medical record computerized physician order entry function. Stage 3 has proposed 80 percent.

A medical imaging clinical decision support solution will become a powerful tool in the hands of a conscientious hospital or ACO medical director.

Steven Gerst, MD, MBA, MPH, CHE, is vice president of medical affairs for MedCurrent, a technology company offering clinical decision support solutions. He has served as an officer of some of the largest healthcare organizations in the U.S. and worked for some of the largest U.S. insurers. A white paper on this topic is available at www.medcurrent.com.