Medicare payment changes take bite out of IR and molecular imaging

November 14, 2007

Imaging advocates fear the adoption of a bundled approach to Medicare reimbursement for contrast media, radiopharmaceuticals, and the technical component of medical imaging could lead to substantial payment cuts from the Hospital Outpatient Prospective Payment System.

Imaging advocates fear the adoption of a bundled approach to Medicare reimbursement for contrast media, radiopharmaceuticals, and the technical component of medical imaging could lead to substantial payment cuts from the Hospital Outpatient Prospective Payment System.

Interventional radiologists could see a 25% loss of revenue after adoption of the final HOPPS regulations, according to American College of Radiology officials. The new formula, which folds the payment for image guidance into the rate for therapeutic aspects of IR, may discourage the adoption of CT or MR guidance in favor of less costly fluoroscopic guidance. It also could slow the adoption of molecular imaging, which relies on expensive pharmaceutical probes, for numerous diagnostic and therapeutic roles.

The Centers for Medicaid and Medicare Services published its final rule for HOPPS changes on Nov. 1. The new reimbursement rates take effect at the start of 2008. The new system involves greater use of bundled payments for imaging services and agents.

The ACR website has a full summary of the final rule.

Traditionally, providers have billed separately for imaging contrast media, radiopharmaceuticals, 3D reformatting, and imaging guidance in interventional radiology. Imaging during angioplasty, for example, is billed separately from the therapeutic procedure itself.

CMS is pushing greater use of bundled payments in order to improve hospitals' efficiency and contain costs. Under the new payment regime, IR applications (including fluoroscopy, ultrasound, MR, and digital subtraction) will be billed as part of the therapeutic procedure, instead of separately. The ACR predicts the plan will "significantly raise the risk that these services will be underpaid when packaged."

Bundled payments are also likely to shift providers away from higher cost guidance techniques such as CT and MR and toward lower cost studies such as fluoroscopy and ultrasound, according to Pam Kassing, the ACR's senior director of economics and health policy.

Image processing services may become less available due to lower reimbursement. Hospitals could shift from more expensive to less costly radiopharmaceutical agents, a move that might not be in patients' best interest, she said in an interview with Diagnostic Imaging.

The CMS initially published proposed changes to the outpatient payment system this summer. After the proposals were published, the ACR sought to delay introduction of packaging of imaging services and agents, but CMS' final rule shows the college's request has been denied. The changes published in the final rule are very similar to the initial proposals, Kassing said.

The ACR will analyze the payment changes again and request changes in areas that it believes could suffer "devastating effects," such as interventional radiology and diagnostic radiopharmaceuticals, she said.

The college has in the past expressed concern that Medicare's single rates often do not cover all the costs involved in a bundled treatment package. The ACR is concerned that if molecular imaging prices are not set correctly in the hospital setting, the progress of new technology and new techniques could be impeded, Kassing said.

Since Medicare rates are based on information provided by hospitals, the ACR is encouraging radiologists to get involved by educating their administrators about the costs of imaging agents and services, to help ensure accurate pricing.

For more information from the Diagnostic Imaging archives:

Two payment systems differ in makeup and intent/a>

Trouble by the numbers: imaging's reimbursement bubble bursts

Whacked! Imaging recoils under DRA ax

ACR solicits comments about pay-for-performance program

Medicare bundling proposal raises concern