House approves imaging reforms in bill extending Medicare to poor children

August 3, 2007

The Children’s Health and Medicare Protection Act of 2007 may look like straightforward legislation to reauthorize a popular healthcare insurance program for poor children, but major reforms directed at medical imaging and the healthcare system as a whole are embedded in the bill passed by the House of Representatives Aug. 1.

The Children's Health and Medicare Protection Act of 2007 may look like straightforward legislation to reauthorize a popular healthcare insurance program for poor children, but major reforms directed at medical imaging and the healthcare system as a whole are embedded in the bill passed by the House of Representatives Aug. 1.

Introduced in committee only a week ago, CHAMP passed by a vote of 225 to 204, with the support of 220 Democrats and five Republicans. Approval came after a day-long floor debate concerning the size and scope of the bill and its implications for national healthcare reform and upcoming election year politics.

CHAMP would inject an additional $50 billion for the State Children's Health Insurance Program, a $5 billion per year initiative that extended Medicaid benefits to about 6.6 million poor children. Without reauthorization, that program will expire Sept. 30.

The bill, sponsored by Rep. John Dingle (D-MI), features numerous provisions potentially affecting diagnostic imaging. It would negate a recent proposal by the Centers for Medicare and Medicaid Services to cut physician payment rates 9.9% in 2008 and 5% in 2009 for a plan that would raise rates 0.5% in each of the two years.

The Sustainable Growth Rate formula used to control Medicare spending growth would be divided into six categories of physician service categories, including one specifically for medical imaging, in 2010, according to the American College of Radiology. Each service category would be allowed to grow at the same rate, with the exception of primary care, which would be granted a higher growth rate.

Variances in the utilization growth of the six categories will produce six separate conversion factors as well, according to the ACR. Slow procedural growth categories will receive positive reimbursement updates, and fast growth categories will receive negative reimbursement updates.

The ACR and the Medical Imaging and Technology Alliance announced opposition to the separate service category approach. The ACR expressed concern about basing reimbursement rates on imaging volume growth, a variable mainly controlled by referring physicians.

Andrew Whitman, vice president of MITA, worried that the combination of CHAMP and Deficit Reduction Act imaging rate cuts would have a devastating effect on the imaging equipment industry represented by MITA and patient access as a whole.

"We have had only two quarters of experience with the DRA, and already access to imaging services, particularly in rural and underserved areas, is being limited," he said.

CHAMP would also cut the technical component for hospital-based outpatient imaging. Those cuts would be achieved by adjusting factors used to calculate practice expenses, according to the ACR. The current formula assumes a 50% equipment utilization rate, and the bill would increase that rate to 75%. The assumed interest rate for imaging equipment is currently 11%. The House legislation instructs CMS to lower the assumption to a fair market value that does not exceed 11%.

CHAMP involves Congress in the contentious debate about appropriate payment rate for contiguous body parts. Medicare currently pays 25% less for additional adjacent body sections imaged on the same day with MR or CT. The bill would double the discount to 50%.

CHAMPS provisions aimed at Medicare imaging would eliminate global billing and expand federal accreditation requirements that apply to mammography to many diagnostic imaging services. MRI, CT, PET, nuclear medicine, x-ray, echocardiography, and emerging technologies would have to be accredited by 2010 to qualify for Medicare payment. The accreditation requirement would apply to diagnostic ultrasound by 2012.

President Bush has threatened to veto the House bill and a more modest bipartisan Senate bill, championed by Senate Finance Committee Chair Max Baucus (D-MT), Charles E. Grassley (R-IA), and Orrin G. Hatch (R-UT). Their compromise plan would increase spending $35 million to expand enrollment over five years.

Congressional analysts say the Democratic-controlled House's efforts to expand Medicare coverage to poor children sets the stage for a push for a federal insurance plan for the nation's 43 million uninsured residents.

The House floor fight over CHAMP was colored with claims of creeping socialized medicine from Republicans and laments from Democrats about injustices in the existing healthcare system. According to a New York Times report, Rep. Pete Sessions (R-TX) said the bill embodied the Democrats' "vision for the future: socialized medicine and Washington-run health care."

Rep. Albert R. Wynn (D-MD) countered for the Democrats: "If America is the greatest country in the world, then all of our children should have health insurance."

As of Thursday, the bill appeared destined for reconciliation in a joint House-Senate conference committee. Both houses adjourned for their traditional month-long recess on Aug. 3, and Congress will address the issue again when it reconvenes Sept. 4.

For more information from the Diagnostic Imaging archives:

Bush veto threat of child insurance bill endangers imaging legislation

Medicare bundling raises concern

CMS gets an earful for reimbursement for coronary CTA

CMS proposes 10% rate cut and self-referral restriction in 2008 Medicare physician payment schedule