November 17, 2008
RBMs — The Wrong Tool?
By Kathy Hardy
Vol. 9 No. 23 P. 12
Radiology questions whether they’re identifying appropriate care or denying it.
Ever since the Eastman Kodak Company added film to the x-ray process, advances in radiology increased the number of tools in a radiologist’s tool kit. In 1956, when ultrasound was first used for medical purposes, the tool kit grew. CT was added in 1972, while MRI was cleared for commercial use by the FDA in 1984.
However, with these advancements have come increases in imaging usage and cost—from $6.89 billion to $14.1 billion in Medicare Part B imaging spending between 2000 and 2006, according to the U.S. Government Accountability Office (GAO) report to Congress this past June. That 104% increase has driven an effort to curb costs and ensure that new technology is being utilized effectively for patients and for the bottom line. Radiology benefits management companies (RBMs) are adding magnifying glasses, calculators, and sharpened pencils to the process as they step between physicians and insurance providers in the healthcare arena.
RBMs are intended to ensure that patients receive consistent quality and appropriate imaging services, particularly as technology advances continue to make their way into imaging suites across the country. However, debate remains about whether RBMs belong in the medical care decision-making process or are primarily tools to contain costs.
Clearly, patients benefit from advances in imaging technology. As James H. Thrall, MD, FACR, notes, imaging procedures can often replace invasive surgical procedures, minimizing the risk of treatment complications and reducing a patient’s recovery time. As radiologist-in-chief of Massachusetts General Hospital in Boston, Thrall sees many instances of how imaging can play an effective part of the patient diagnosis process.
“In emergency rooms today, patients with chest and abdomi-nal pain undergo CT scans, eliminating the concept of explora-tory surgery,” Thrall says. “Before CT, someone with a suspected case of appendicitis underwent an appendectomy, and 20% of those patients turned out to not have appendicitis. That number is down to 1% today.”
But with trillions of dollars spent on healthcare in the United States, cost issues need to be addressed.
“It is in everyone’s best interest in the health system to achieve appropriate imaging utilization,” says Thrall, who also serves as chair of the ACR’s board of chancellors. “Unfortunately, there is no easy formula to determine what that will be. It is realistic to have tension between the developers of new imaging methods and the desires and needs of the insurance industry to hold costs down to a reasonable level. In the long run, even people who provide imaging services need to realize the importance of appropriate imaging. If we just break the bank, that’s not good either.”
Closer scrutiny of imaging spending began as recently as 2005 when the Medicare Payment Advisory Commission (MedPAC) reported to Congress on the increasing number of imaging exams provided, as well as greater use of high-technology imaging such as MRI vs. x-rays in diagnostic testing. This report attributed growth not only to technology advances but also to the increase in the number of in-office imaging procedures. It also pointed out that the number of imaging services provided across the country varies significantly from state to state, suggesting possible overuse in certain areas. The Centers for Medicare & Medicaid Services (CMS) adopted some of MedPAC;s recommendations beginning in 2006.
In addition, further constraints on imaging services spending began with the Deficit Reduction Act of 2005. The CMS, along with Health and Human Services (HHS), worked on the act with Congress in an attempt to manage one of the fastest-growing services under Medicare Part B. Those cuts were lobbied against heavily by radiology organizations but, as enacted, cut Medicare imaging spending by $1.8 billion in 2007, according to a new GAO report released in September. That represents a decrease of 12.7% from the previous year compared with the average annual 11.4% increases from 2000 to 2006.
The June GAO report noted that financial incentives for physicians to offer imaging services within their practice is a primary influence on the recent growth of in-office imaging. The proportion of Medicare imaging spending devoted to in-office services increased from 58% to 64% during the six-year time period studied. Other reasons include technology advances, direct-to-patient consumer advertising, defensive medicine to protect physicians from malpractice suits, and an increase in clinical applications.
The June report also noted that the highest growth rates occurred among the advanced imaging services of MRI, CT, and nuclear medicine. Spending in these modalities increased almost twice as fast as spending on other imaging procedures such as ultrasounds and x-rays. The rationale for the difference is that advanced imaging services are more complex, they most often involve payments for conducting the exam and reviewing results, and equipment for these modalities is more expensive and requires more highly skilled technicians to operate.
The June GAO report recommended that the CMS add more preauthorization mechanisms in an attempt to manage imaging costs, a recommendation that RBMs have found cost-effective and worthwhile. Private health plan practices that were examined as part of the GAO’s reporting also noted increases in imaging services, particularly in advanced imaging. These plans adopted management practices, including preauthorization, that helped constrain their spending growth on imaging services.
While they’ve appeared effective at curbing costs, physicians and industry experts worry about what the GAO recommendations may mean to the quality of medical care in addition to the threat to their revenue. These two groups believe accreditation and appropriateness criteria are the answer.
Thrall explains that RBMs emerged as a “cottage industry” to help insurance companies concerned with the rapid increase in imaging costs. When they believe that the growth is not being appropriately managed, health insurance companies hire RBMs to help manage costs, as well as the quality of imaging care. Some current players in the RBM marketplace include MedSolutions; American Imaging Management, Inc; Care to Care, LLC; and Magellan Health Services, Inc, which owns National Imaging Associates, Inc.
MedSolutions CEO Curt Thorne says imaging plays an important part in the diagnostic process, and the role of the RBM is to ensure that patients receive the correct imaging studies. And in the course of providing appropriate imaging services, the healthcare system saves money.
According to a September Congressional Budget Office report on baseline budget projections, Medicare spending is expected to grow from $454 billion this year to $570 billion by 2012 (a 25% increase) and to $822 billion (an additional 44% from 2012) by 2016. If those projections hold, Medicare spending would rise from 16% of total federal outlays in 2007 to 18.9% by 2016. In that same time period, the budget office projects the government’s annual budget deficit to climb from $454 billion to $735 billion (61.8%).
“It’s pretty important that we engage the debate over how we take care of the healthcare needs of America,” Thorne says.
MedSolutions signed its first radiology management contract in 1996 but actually got its start in the industry in 1992 as an owner/operator of diagnostic imaging centers. It was this early perspective on imaging utilization and cost that the company used to segue into managing radiology spending.
How It Works
Thorne says 85% of MedSolutions’ focus is on outpatient imaging, covering both commercial and government-sponsored health benefits programs. When a request for imaging comes to the RBM for preauthorization, medical professionals such as nurses and radiologists speak with physicians about using the best imaging technology that meets patients’ needs. The request for imaging must meet the proper evidence-based guidelines for approval.
“RBMs are dedicated to identifying the right care as a way to save money,” Thorne says. “If you get the right care right away, you save money.”
Thorne explains that the marketplace driver for RBMs is the increase in costs, particularly among the advanced-imaging services, which account for 20% of all scans but 60% of the costs. He says they also see healthcare variations across the country, where one region may be adopting new imaging tech-nology faster than another. With that early adoption, he believes, may come issues regarding appropriate use. In some cases, the technology is being used before substantial evidence of its success or failure can be gathered and reviewed.
“We’re finding that the diffusion of clinical evidence is slower than the update in use,” Thorne says. “The healthcare field is busy sorting out this rapidly changing technology, and sometimes that process is not highly efficient. This is wonderful technology that allows physicians to look into the body rather than perform surgeries. However, we need an evidence-based approach to what imaging procedures should be used.”
MedSolutions uses evidence-based guidelines when making decisions regarding requests for imaging services, Thorne says. In addition, this RBM has a patent pending on software it developed called Predictor Radiology Intelligence that tracks trends in physicians’ ordering patterns. For example, if a physician orders 10 shoulder MRIs, all consistent with the evidence-based guidelines for the injury, that pattern will be recorded. If that same physician makes a different diagnosis on the 11th shoulder injury, an alert is sent.
“It’s highly relevant in the marketplace that the application of our services do not interfere with the delivery of needed healthcare to patients,” he says. “We have spent a lot of time and effort in refining our process.”
Trying to Be Transparent
Thorne says one of the goals of RBMs is to remain as transparent as possible in the healthcare treatment approval process. Between 50% and 60% of all requests for imaging services are answered in less than 15 minutes, he says, with a high percentage of those answered in five minutes. Overall, between 80% and 90% of all decisions are made in less than eight hours, he says.
“We look to not negatively impact care,” he says. “If you impact the quality of diagnostics in healthcare, you could be counterproductive.”
Negative is a word radiologist David Gruen, MD, would use when describing the effect of RBMs on patient care. As assistant chief of the medical staff at Norwalk Hospital in Connecticut, Gruen lives the experiences of his patients as they fight to undergo the imaging procedures prescribed by their physicians.
“I think that RBMs are the worst things to happen to patients in a long time,” Gruen says. “Do patients trust their doctor, or do they trust a third-party entity who doesn’t know them? They don’t know the patients.”
Gruen, who also specializes in women’s imaging, believes that in the beginning, the intent of RBMs was to make sure the medical profession made appropriate decisions concerning imaging. However, as he tells the story of one of his patients and her experience with the preauthorization process, it demonstrates how he believes the process has strayed from its intended goal. The woman recently had an abnormal mammogram. The images were not specific enough to prove or disprove whether she had cancer, so Gruen ordered an MRI. The results of the MRI showed several spots 1 to 4 millimeters in size in one breast and one spot in the other.
“It could have been nothing, or it could have been something,” Gruen says.
Because of the patient’s family history of breast cancer, Gruen ordered a repeat MRI in six months. However, when it came time for the second breast MRI, it was denied, with a recommended less-expensive alternative of undergoing three breast biopsies. Gruen notes that biopsies come with their own costs and risks as an invasive surgical procedure.
Interfering With Care?
“The RBM has taken over the care of this patient in a very bad way,” he says. “The patient can’t afford an MRI, but she thought she had good insurance. Insurance companies are not doing what they should do. They have handed over decisions to RBMs to cut costs.”
Gruen cites another example in which the RBM played a significant role in patient care. A pediatrician was using antibiotics to treat a diabetic patient believed to have osteomyelitis in his foot. When it became clear that the foot was not responding to the antibiotic, the pediatrician consulted with a radiologist, and they decided that an MRI was the most effective test to determine what was causing problems with the foot. Staff spent 90 minutes on the phone with the RBM, attempting to get approval for the imaging procedure. After 48 to 72 hours of medical review, the RBM ruled that the patient needed to undergo four to six weeks of antibiotic treatment and then see a specialist, who could order the MRI.
The patient’s next step was to see an infectious disease specialist, who drew blood for testing. One week later, the patient was examined by an orthopedist, who ordered an x-ray of the foot. The x-ray was inconclusive, so an MRI was ordered. In the end, the MRI confirmed that osteomyelitis was the cause of the patient’s foot problem, and the proper course of treatment began.
“They [the RBM and the health insurance provider] hoped that the pediatrician would just give up,” Gruen says. “They just wanted to take imaging out of the system.”
HHS comments raise concerns about the administrative burden of implementing prior authorization for imaging services covered under Medicare Part B. In comments included in the June GAO report, HHS noted that RBMs using proprietary methods to deny claims for imaging services may be using criteria more stringent than the Medicare rules. Those denials could be overturned by Medicare claims appeals process, which usually requires an explanation for the denial. A high rate of overturned denials, HHS said, “would not be considered an effective policy tool.”
Maureen Zilly, director of government relations for the Medical Imaging & Technology Alliance (MITA), agrees with HHS that preauthorization may not be the best cost-cutting alternative for Medicare patients. The MITA is an imaging industry advocacy group whose board is comprised of executives from imaging industry manufacturers.
“The GAO report deals with the costs, but it doesn’t address how prior authorization impacts patients,” she says. “This is not an appropriate model for Medicare, where patients have multiple issues. It’s a sensitive audience.”
Gruen points to physicians with imaging devices in their offices when looking for a cause of increased costs.
“The real problem is that self-referral has jacked up imaging costs,” he says. “When a cardiologist owns a nuclear imaging machine, he has to pay for that and pay the technician to run it. Doctors who own imaging equipment do more imaging.”
Another side of the in-office imaging issue is patient convenience. If a patient can see an orthopedist and undergo necessary imaging in the same stop, it is quicker and more convenient.
The June GAO report also noted a trend in site care, shifting substantially from hospital inpatient and outpatient settings to physicians’ offices. Diagnostic imaging conducted in the former location is governed by national Medicare standards relating to patient safety and quality, while the latter falls under less stringent oversight.
In-office imaging is covered by Medicare Part B and was the specific subject of the GAO’s report, while imaging done in a hospital or other institutional setting is paid for under Medicare Part A and was not included in the findings. Under the Medicare physician fee schedule, physicians can be paid for performing the technical and professional components of the procedure, with the cost of the technical portion usually significantly higher than the professional portion. When imaging exams occur within a hospital or other institutional setting, such as a skilled nursing facility, the physician can only bill Medicare for the professional portion, and the hospital bills the technical component.
On this topic, Thrall says the issue of reducing the number of unnecessary imaging exams performed in an in-office setting should be dealt with directly, with decisions taken out of physicians’ hands. Financial incentives for physicians to order more in-office scans should be removed.
“In a preauthorization situation, whether it’s through insurance companies or RBMs, we know that with financially motivated self-referrals, imaging is used between two and 12 times as often as when there is no financial motivation,” Thrall says. “We’re finding little or no utility for this type of imaging. The RBMs are tuned in to this. It is their goal to not approve unnecessary imaging, which might occur more often in this situation.”
Accreditation should also help reduce self-referrals, he says, noting that, in some instances, in-office providers purchase low-quality or used equipment that was taken out of service elsewhere.
“With quality standards in place for imaging equipment and technicians, we’re hopeful that some in-office providers will not be able to obtain accreditation,” he says.
The ACR and other organizations point to the recently adopted Medicare Improvements for Patients and Providers Act of 2008 as offering more effective options to preauthorization for imaging services. The law addresses the following two aspects of medical imaging:
• It requires that all suppliers providing the technical component of advanced imaging services be accredited by a designated accreditation organization by January 1, 2012.
• It requires HHS to establish a demonstration project to assess the appropriate use of advanced imaging services by January 1, 2010. Accrediting organizations have yet to be determined, but Thrall believes they may follow guidelines similar to those established by the ACR.
“With the Medicare act, Congress took the method of controlling imaging costs in a different direction,” Thrall says. “In-stead of using RBMs, they have called for a demonstration of physician support services.”
He adds that accreditation is a vital component of the decision-making process when it comes to evidence-based imaging decisions.
“Accreditation speaks to the quality of the individuals involved in the process,” he says. “It speaks to the quality of the imaging equipment. Radiologists need to be engaged in a peer-review process to ensure the quality of their interpretations.”
Gruen agrees that regulation and accreditation standards are important and should be part of the imaging approval process. “The days of the mom-and-pop medical offices are gone,” he says. “Requirements, certification, and accreditation need to be in place.”
Zilly says her organization, which is a division of the National Electrical Manufacturers Association, fully supports establishing accreditation standards, not only for those doing the imaging and reading the images, but for the imaging equipment as well. The MITA recently sponsored a report completed by the business analysis firm Avalere Health LLC that outlines three emerging strategies for the responsible use of medical imaging: appropriateness guidelines; accreditation and certification programs for facilities, physicians, and equipment; and education and training programs.
“These recommendations bring consistency and validity to the imaging process,” she says. “They also take the patient into consideration.”
While Zilly acknowledges that the MITA’s opinions on the issue of preauthorization for imaging services comes from a membership comprised of imaging service developers and manufacturers, she says the interests here span the medical field.
“There are situations where we all don’t have the same goals,” she says. “However, on this issue, we felt concerned enough to work to get important policies included in the Medicare law. And it’s not just us. The medical community is concerned as well.”
Thrall believes that implementing the ACR Appropriateness Criteria may help address the GAO report that identified nonradiologists’ lack of training in determining which exam is most appropriate as a factor in increased in-office imaging. The ACR criteria is a list of approximately 300 evidence-based guidelines developed by the college 15 years ago to provide guidance for referring physicians and other providers in determining the best methods for imaging a patient. The guidelines link the disease process to different methods of imaging. It utilizes a scoring process of one through nine, with one being the least applicable method and nine being the most appropriate.
“Physicians review the criteria and determine the best method for the patient,” Thrall says.
The ACR promotes the criteria’s commercial use to medical professionals nationwide. Thrall says Massachusetts General uses a software product that incorporates the criteria. He notes that local insurance companies have accepted this point-of-care patient support system.
“This computer-based system is well received by referring physicians,” he says. “They can see the score for the test that was ordered, and the system provides scores for alternative methods. It allows physicians to see if there is a better method.”
Imaging services are not the only targets of cost-increase analysis. Thorne says there are many parallels between the process used to order imaging services and the placement of pharmaceutical prescriptions. Both are disciplines of medicine that cover the spectrum of diseases, and both involve technol-ogy that is moving faster than any other discipline.
“In both imaging and pharmaceuticals, you also have circumstances where the decision makers are separate from the economic entity that delivers the product,” he says. “These things create unique challenges as they relate to the need for behavior changes in the market.”
In the end, Gruen would like to see radiologists treated as specialists in their fields. Radiologists must rely on referrals to provide patient care and need to follow specific standards in the care they provide.
“Radiologists can’t take care of their own patients,” he says. “They have to send patients back to their primary care physicians to get an MRI. Radiologists need to have oversight. When I tell a patient an MRI is medically appropriate, we should be able to order the image. Put imaging back in the hands of the experts.”
— Kathy Hardy is a freelance writer based in Phoenixville, Pa., and a frequent contributor to Radiology Today.