Radiology’s Role in Determining Medical Necessity

July 28, 2016

Is an NJ case that deemed radiologists liable for determining medical necessity just the beginning?

Recently, a New Jersey court handed down a decision that could potential change the role radiologists play when it comes to determining the medical necessity of a study ordered by a referring physician.

Although the current ruling only applies to New Jersey radiologists, industry experts are talking about how it could possibly affect your responsibilities, daily work flow, and liabilities.

The Case
Allstate Insurance brought suit against radiologists who conducted MRIs and X-rays on patients who had submitted personal injury claims. The company argued the providers had not completed their due diligence in checking into whether these studies were warranted, suing to recoup $200,000 of expenditures.

Company lawyers asserted the radiologists were the imaging center’s medical directors and, therefore, bore the responsibility of verifying medical necessity. The radiologists countered that the chiropractors and other referring physicians who send them patients satisfy the state’s requirement of being “verified” providers. But, the judge ultimately ruled the onus of ensuring proper clinical evidence exists to support medical necessity and appropriateness lies with the radiologist.

According to Greg Nicola, MD, treasurer of the Radiological Society of New Jersey, the organization is filing an appeal of the ruling. The American College of Radiology (ACR) also considers the case to be unique – one that will likely only bind New Jersey radiologists, said Tom Hoffman, JD, the ACR’s associate general counsel.

“The lesson remains to realize that the radiologists aren’t in the driver’s seat about medical necessity decisions because they don’t interact daily with the patient,” Hoffman said. “They’re hard pressed to have all the sufficient clinical background on a patient.”

Impact on Your Daily Work
The specter of having to double-check behind your referring physicians to ensure they’re ordering proper studies can be daunting, Nicola said. In most cases, if a provider sends a study order, accompanied by either an ICD-9 or ICD-10 code, you likely assume there’s sufficient medical evidence in each case. Adding another layer to the process could slow your work flow to a slog.

“I don’t think we could do it – there are so many studies to do in a day,” he said. “If we have to validate every prescription – either with the patient or the doctor – that would be very difficult.”

But, before you worry too much, he said, you’re likely already taking steps to validate the medical necessity of nearly every study that comes into your imaging center. By having patients fill out forms and questionnaires that ask for the reasons behind their clinical visit and request for a study, you’ll have official documentation of medical necessity. For example, any patient who comes in for an MRI of the lower back can explain their experience with possible long-term back pain.

Unfortunately, emergency departments and hospital inpatient settings don’t have the resources available to disseminate and gather these forms, and in many cases, patients aren’t able to fill them out.

But, if you do have questions, Nicola said, don’t shy away from giving the referring physician a quick phone call to verify why he or she has ordered the study. And, if you disagree, offer your expert opinion. When you can, he said, make all calls to referring providers at least a day before you’re expected to perform the study.

“Always reach out to your referring physicians in the community,” he said. “Don’t ever be intimidated to do so. It helps keep the lines of communication open.

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It’s not likely radiologists will find themselves responsible for justifying medical necessity in the lion’s share of cases, said Melody Mulaik, president of Coding Strategies. This situation will hopefully only impact the small share of business created by patients with injury or workers’ compensation claims.

For Medicare patients, referring physicians will soon be required to use clinical decision support tools that help them select the most appropriate study. And, larger commercial payers require referring physicians to obtain pre-certification or pre-authorization prior to receiving higher modality exams such as CT, MRI, and PET.

Even though the referring physicians arguably bear the medical necessity responsibility, she recommended radiologists work with their staff to ensure they have the most complete clinical order possible before a study is performed.

Adding on the responsibility of determining medical necessity for imaging is more of a concern for free-standing radiology imaging centers than for hospital-based radiologists, Mulaik said. They’re more likely to have contracts with liability payers, so they must pay attention to the details of the contracts they sign.

Before signing, be sure you understand what the contract says in terms of treating all types of patients – especially those that might fall into the injury or workers’ compensation categories. Be sure your responsibilities are clearly laid out and the person ultimately responsible for determining medical necessity is clearly identified.

Getting these details ironed out will require an open-door conversation with your referring physicians – not only will it provide details about what you’re expected to do with certain patients, but it will also make the relationship stronger.

“Radiologists have never said it’s not their responsibility to make sure the right exam is being done. They pride themselves on being the doctor’s doctor,” Mulaik said.

Prepare and Protect Yourself
On a daily basis, a radiologist’s first priority should be to collaborate openly with the referring physicians because he or she always has the most complete body of information about the patient, ACR’s Hoffman said, and they can best understand the patient’s needs at any given time.

But, court decisions like the New Jersey case can muddy these waters, making you wonder whether frequent communication is enough to ensure you’re fulfilling your clinical responsibility.

Even though it’s unlikely you’ll be required to check behind every study order you receive from your referring physicians, Hoffman suggested radiologists take steps to ensure you’re always confirming medical necessity before you conduct any studies.

1. Know your own state: Take the time to look into what you are expected to do in your state. Each state could have different requirements, so be sure you’re compliant with the laws in your state of practice.

2. Participate: The days of working in the reading room are long gone. Make the effort to participate in professional societies, meetings, and other events. Join committees, and go on rounds. Not only will your professional network grow, but you’ll be better positioned to exercise your voice in decisions that could impact your daily practice.

3. Maximize Clinical Information: Work with your staff to gather as much information as you can about each patient’s clinical information.

4. Organize Yourself: It isn’t enough to merely have enough patient information. Keep it properly categorized in case you are ever audited or visited by state law enforcement or health care officials, such as your state health department or the attorney general.

If you do find yourself faced with accusations of not verifying whether a study is medically necessary, Hoffman advised you don’t try to handle the situation yourself. Instead, hire a qualified health care attorney who can present your case in court effectively.

The final ruling for the New Jersey case has yet to be written. In the meantime, he said, continue to practice as you have, but remember the onus is on you to talk with your referring physicians regularly about their ordering habits, reach out to new providers you don’t know, and ensure you have the most complete dossier of clinical information on each patient as you can.

“You can’t practice in a vacuum and believe that you’re only there to accept referrals from certain physicians,” he said. “The studies you conduct can’t not be grounded in sufficient clinical background. That determination comes first and foremost by the physician.”