The Consequences of Medicare Fee Cuts on Imaging Practices
Journal Wrap | When the Centers for Medicare and Medicaid reduced fees for cardiology services in 2010, focusing particularly on those delivered in private practices, the ACC predicted that many offices would integrate with hospitals in response. A new analysis published in JAMA: Internal Medicine has examined the effect these cuts had on practices and costs of cardiovascular imaging services.
The authors analyzed data from medical claims made between 2007 and 2012. The sample included 806,266 Medicare beneficiaries from every state and 12,567,069 commercially insured individuals with a similar geographic distribution. They also measured cardiologist-hospital integration by calculating the share of volume billed by hospital outpatient departments (HOPD), focusing on three affected services—myocardial perfusion imaging (MPI), echocardiograms, and electrocardiograms. For all services, prices favored the HOPDs after 2010. The shares of volume in HOPDs also increased after that year. Growth in the HOPD share was 5.9%, 3.9%, and 2.7% per year faster after 2010 compared with growth before 2010 for MPI, echocardiograms, and electrocardiograms, respectively. The volume of echocardiograms and electrocardiograms per beneficiary continued to increase after the fee cut, while that for MPI decreased slightly.
The researchers also point out that similar results were seen across all cardiovascular imaging and cardiovascular medicine services. There were also similar results seen in commercial populations, suggesting that integration was associated with comparable effects across payers.
Cardiologist integration from private practice to hospital accelerated after the fee cuts. This reflects the ACC’s 2010 Practice Census, which found that 40% of cardiologists planned to integrate with hospitals due to fee cuts and another 13% were considering it.
“Hospital outpatient departments may be more expensive than office setting because of the costs of licensing requirements, ancillary services, maintaining standby capacity, and treating more complex patients,” said the authors. “However, if equivalent quality care could be delivered in the office, the case for paying the higher fee may be more difficult to justify. Ultimately, integration may offset savings that fee cuts were attended to achieve, both because facility-based fees are higher and because of higher prices due to market power.”
There has been increased attention being paid to equalize payments as recognition for payment disparities has grown. If fee cuts are leading to the hospital acquisition of practices, the payment gap may need to be narrowed in order to lead to less integration and, in turn, limit price increases.
In a related commentary, Ralph Brindis, MD, an ACC past-president, and Eugene Sherman, MD, chair of both the ACC’s Advocacy Steering Committee and Political Action Committee, note that “the current health care delivery challenges and resultant changes to the practice landscape demand creative and workable solutions to meet the needs of new practice and models as well as help current private practitioners maintain viability while simultaneously promoting high value in health care delivery.” They add that, in particular, the overuse of unnecessary tests and procedures can be addressed by implementing payment models that encourage appropriate testing while discouraging inappropriate testing, rather than by decreasing reimbursement. They write that “physicians will need to assume leadership in new delivery systems and health care policy to encourage all specialties to practice cost-effective medicine.”
- Song Z, Wallace J, Neprash HT, et al. JAMA Intern Med. 2015;doi:10.1001/jamainternmed.2015.2021.
Keywords: CardioSource WorldNews, ACC Publications, Costs and Cost Analysis, Fees and Charges, Hospitals, Medicaid, Medicare, Private Practice
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