States, insurers push agenda against self-referral

November 3, 2009
H.A. Abella
H.A. Abella

Although radiologists’ call to crack down on imaging self-referral has not found a strong reception in Congress, government agencies and insurance companies at the state level have been gradually tightening their oversight and control of the controversial practice. Radiologists could play an important role in keeping up the momentum.

Although radiologists' call to crack down on imaging self-referral has not found a strong reception in Congress, government agencies and insurance companies at the state level have been gradually tightening their oversight and control of the controversial practice. Radiologists could play an important role in keeping up the momentum.

Long-time self-referral critic Dr. David Levin laid out a blueprint for state-level action to combat onerous referring physician practices Oct. 29 in a lecture at the 2009 Economics of Diagnostic Imaging National Symposium in Arlington, VA.

A professor of radiology at Thomas Jefferson University in Philadelphia, Levin emphasized legislative and enforcement efforts in selected states that could be emulated elsewhere.

Cases in point were California Assembly Bill 2794 and Connecticut Public Act 09-2006, passed in 2008 and 2009, respectively, that prohibit physicians from billing for the technical component of CT, MRI, or PET unless they have actually rendered the service. The laws allow facilities that offer these services to bill directly, but prohibit the referring physicians from doing so.

"Taken together, these two provisions get at the heart of per-click leasing schemes," Levin said.

Levin also described the case of six orthopedic surgery groups that asked the Maryland Board of Physicians in 2006 to revise a decision by a third-party payer to deny coverage of imaging services based on the state's existing anti–self-referral law. Although the law in question includes an exception for in-office ancillary services that mirrors federal Stark Laws, it specifically excludes MRI, CT, and radiation therapy.

The board ruled against the orthopedic surgeons, who then asked for judicial review. In 2007, The Montgomery County Circuit Court ruled in favor of the board. The decision was upheld twice on appeals that went all the way to the state's highest court. Bills to repeal the law's advanced imaging exclusions were introduced in 2009, but they failed. In a similar case, this time by the Louisiana Board of Medical Examiners, arrangements made by referring physicians to lease or purchase the technical and professional component of imaging services were called illegal.

Levin illustrated the law-enforcement scenario with a case involving the Illinois Attorney General, who filed a lawsuit against 11 Chicago imaging centers that allegedly used leasing arrangements to cover illegal kickbacks. The AG's office received a tip from an individual who took advantage of a "whistleblower" law to alert authorities. According to Levin, the case highlights what radiologists can do to protect turf.

"If you try and bring these scams to the attention of the media, law enforcement and lawmakers are likely to act," he said.

Challenges to imaging self-referral do not always come about through direct action, however, but sometimes happen indirectly as a result of quality improvement efforts, Levin said. New Jersey, for example, implemented an annual x-ray Quality Assurance program that ensures its imaging facilities comply with imaging quality and safety standards. These include daily records on patients' radiation exposure, sensitometry and densitometry measurements, and per-modality checks for contrast resolution, noise, or artifacts, among other factors.

"Three years after the program started, a large number of marginal imaging providers who could not meet the standards had to drop out of practice," Levin said.

Private payers have also contributed to reining in self-referral. Some Blue Cross/Blue Shields in Connecticut, for instance, now require facilities to have a minimum of five imaging modalities to reimburse for CT and MRI scans. In addition, facilities must be owned or leased full-time by the provider and be open at least 40 hours per week. A number of state Blues now also impose accreditation requirements and subspecialty privileges based on residency training or a hospital's customary imaging interpretation arrangements, he said.

Before year's end, United Healthcare will require imaging facilities to be accredited by the American College of Radiology or the Intersocietal Accreditation Commission to be reimbursed for CT and CTA, MR and MRA, PET and nuclear medicine, and echocardiography, Levin said.

"This is a good way for payers to control imaging self-referral," he said.