GAO study turns self-referral reform focus to physician private-office procedures

May 4, 1994

Stark may seek to include practices in an expanded federal banPhysicianswho conduct medical imaging procedures in their own offices orderfar more tests than doctors who send patients outside their practices,according to a report released last

Stark may seek to include practices in an expanded federal ban

Physicianswho conduct medical imaging procedures in their own offices orderfar more tests than doctors who send patients outside their practices,according to a report released last month by the General AccountingOffice. The GAO report could provide self-referral foe Rep. PeteStark (D-CA) with the ammunition needed to close a loophole inthe federal ban on physician self-referral.

The GAO study examined 2.4 million Medicare records involvingseven different kinds of medical imaging tests in physician officesand group practices. The study found that in-practice imagingrates exceeded referral imaging rates for all seven services.

For example, in-office physicians ordered:

** Four to five times as many ultrasound, echocardiographyand nuclear medicine exams;

** Three times as many MRI scans; and

** Twice as many CT and x-ray exams.

The numbers were particularly high among cardiologists, accordingto Stark. The study found that cardiologists with MRI scannersin their practices ordered 9.65 MRI scans per 1000 patients, comparedto .95 MRIs ordered by doctors who referred their patients toradiologists.

"There have always been problems with self-referrals,but the magnitude of over-ordering of tests by doctors who ownan interest in an x-ray or MRI practice is staggering," Starksaid. "The GAO data indicate that many doctors are rippingoff patients."

Stark was the main force behind a ban on physician self-referralon imaging services paid for by Medicare and Medicaid (SCAN 8/25/93).Self-referring physicians must divest their investments by theend of this year.

That law contained a loophole exempting services furnishedby physicians in their own offices or within group practices.The GAO study could be used as the evidence Stark needs to eliminatethose loopholes.

Stark is sponsoring a health-care reform bill that is separatefrom President Clinton's legislation. That bill extends the federalban on self-referral to all insurance payors. The bill does containan exemption for in-office and group practices, but that couldbe amended as a result of the GAO study.

"We've only had the data since April, but the GAO reportindicates that (in-office referrals) are an area that needs tobe looked at," an aide to Stark said.