Cost cutting: Switch to outpatient MRI services might not bank savings for Medicare

Thanks to reimbursement rate cuts, there’s been an identifiable shift from MR exams performed in private offices to hospital outpatient departments, according to a new study in the Journal of the American College of Radiology published Nov. 15.

The study was led by David C. Levin, MD, of Thomas Jefferson University Hospital in Philadelphia, and found that despite attempting to cut costs, the shift to hospital-based facilities might not yield the savings Medicare officials hope for.

Levin and colleagues noted that in recent years, the Center for Medicare & Medicaid Services reduced imaging reimbursements that affected radiologists and their practice revenues.

“The fact that the cuts were primarily related to the technical component of imaging reimbursement caused concern that they would lead to closure of radiology private offices and/or a shift of outpatient advanced imaging from private offices to hospital outpatient facilities,” the research team wrote.

This shift could result in higher prices for essentially the same services, Levin and team argued.

Researchers used the nationwide Medicare Part B Physician/Supplier Procedure Summary Master Files for 2002 through 2012, which provides annual Medicare procedure volume, allowed payments and information. All MRI codes were selected, except those for MRI guidance for invasive procedures.

“For the first part of this study, we compared trends in all elective outpatient MRI exams done in private offices and HOPDs,” Levin and team wrote.

The team found that in 2002, MRI volumes in private practice and hospital outpatient departments were similar (1,764,202 and 1,688,625, respectively).

From 2002 until 2006, the number of MRI procedures grew considerably in both private practice office and outpatient departments, but the growth was more rapid in offices.

By 2011 outpatient procedure volume had caught office volume and by 2012, hospital outpatient department MRI procedures had surpassed private office numbers—at 2,660,565 and 2,433,390, respectively.

By 2012, more than 227,000 more studies were done in HOPDs than in offices and researchers found the rapid growth of office use of MRI by orthopedic surgeons and “other physicians” (216 percent and 124 percent, respectively) than that by radiologists (27 percent) noteworthy.

“The onset of the Deficit Reduction Act cuts in 2007, which sharply reduced technical-component payments for private office MRI and other advanced imaging, do not seem to have substantially affected either group,” Levin and colleagues wrote. “The reason could be that nonradiologist physicians who operate their own MRI units are often in a position to self-refer more volume and thereby compensate for reductions in per-procedure payments.”

Levin and team noted that despite the cuts to technical-component reimbursements, savings to Medicare are partially offset by the higher costs of many types of MRI examinations if they are shifted to hospital-based facilities.