RBMA president discusses an industry in a state of upheaval

How far we have come from when Edward Trevert, in 1896, published an “interesting book” about the “construction of x-ray equipment and conducting experiments which demonstrate the imaging characteristics of x-radiation.” Issues currently affecting radiologists more than 100 years later, such as use of the Sustainable Growth Rate (SGR) in calculating Medicare’s payment to physicians, the impact of teleradiology on the viability of radiology practices, and physician self-referral, were not even remote concepts at the time.

The imaging community continues to reel from the effects of the Deficit Reduction Act of 2005, which levied a projected $2.8 billion in reductions on imaging services through 2011 and a projected $8.1 billion through 2016. The multiple procedure payment reduction in the technical component for multiple contiguous body parts in the same session was almost immediately mimicked by the private payor community, and the most drastically affected procedures continue to be CT, MRI, and positron emission tomography (PET) scans.

Use of the SGR as a variable in calculating Medicare payments for physicians’ services has been under debate for years. The Social Security Act requires the Secretary of Health and Human Services to provide the Medicare Payment Advisory Commission (MedPAC) with an estimated SGR and an estimated conversion factor for Medicare payments annually. For the past several years, Congress has intervened to prevent drastic payment reductions as a result of the use of this formula and 2008 is no exception. Congress overturned a presidential veto and replaced a 10.6% reduction in physician payments with current funding through 2008 and a 1.1% increase in 2009.

In addition to the impact of the formula on physician payments, the results of the third 5-year review of work relative value units and proposed changes to the practice expense methodology, as proposed in June 2006 and implemented in January 2007, will continue to have a redistributive effect on physician payments through 2011.

The real cause for concern is when this information is layered with MedPAC’s demographic report showing the total number of Medicare beneficiaries is expected to almost double between 2000 and 2030, from about 40 million to 79 million beneficiaries. The rate of increase in enrollment will accelerate most noticeably around 2010 when the first of the Baby Boomers become eligible and the growth is not expected to slow until the entire Boomer generation has become eligible, around 2030. Couple this with MedPAC’s projected growth in imaging utilization, and subsequent escalations in Medicare’s imaging expenditures are likely to keep further reductions on the Congressional agenda for more years to come.

Complicating matters is that while radiologists have been advised to negotiate managed care fee schedules on a per CPT basis, the vast majority of commercial plans continue to calculate compensation as a percentage of either a specific Medicare year or the prevailing Medicare year, resulting in a relatively significant portion of a radiologist’s receipts being tied to the Medicare Physician Fee Schedule (MPFS).

Though the Centers for Medicare and Medicaid Services have delayed implementation of the anti-markup provisions as revised in the 2008 MPFS Final Rule until January 1, 2009, it is likely this topic will remain on radiology’s “hot topics” list for 2009. The apparent intent of the provision is to eliminate the opportunity for the billing physician to profit from the radiologist’s interpretation, certain to be a disruption to the in-office ancillary exception.

Not surprisingly, there are many more hot topics facing radiology:

  • The growing use of nonphysician personnel and “super techs” to perform duties that have historically been the purview of the radiologist;
  • The increase in radiation exposure, primarily due to an increased use of CT, and minimizing this exposure;
  • The role of accreditation and credentialing in the payment delivery system;
  • Future of pay for performance initiatives and if commercial payors will follow suit;
  • Enhancing information technology to decrease duplication of efforts and increase efficiencies and accuracy in data capture and data processing;
  • The reemergence of health care reform with a new administration;
  • The explosion of teleradiology and the emergence of “dayhawk”;
  • The continued impact of government regulations.

While there are many dynamic “moving parts” on the radiology landscape, one variable likely to remain constant is an increasing number of imaging procedures compared with a fairly static supply of radiologists.

Barbara F. Rubel, MBA, is president of the Radiology Business Management Association.