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Commentary |
1 Department of Radiology, University of Virginia, PO Box 800170, Charlottesville, VA 22908.
Address correspondence to B. J. Hillman
(bjh8a{at}virginia.edu).
Keywords: imaging • self-referral • STARK II
Nonradiologist self-referral for imaging procedures continues to increase as a fraction of all imaging examinations performed in the United States and is a major contributor to the perception that the unsustainable increase in imaging costs is fueled by financial incentives that engender too many marginal and inappropriate examinations. A recent article by Dr. Jean Mitchell [1] reporting research findings in the journal Health Affairs supports this contention. The article details an increase in creative self-referral arrangements in California, which abrogate ethical and possibly legal restrictions. Specifically, Mitchell's study relates an increase in block-time leasing and pay-per-click for CT, MRI, and PET in California and details how the availability of such dealings promotes self-referral. To me, the results also show that current regulations governing self-referral—largely generated in the early 1990s—are archaic, ambiguous, and hence ineffective.
Self-referral provides an interesting case study of how research can influence regulatory policy. Several publications were particularly influential with regard to anti-self-referral regulation. The self-same Dr. Mitchell, with her colleague Elton Scott [2], evaluated self-referral to physician-owned, freestanding facilities in the state of Florida and found physician ownership of such facilities to be rampant, even in the late 1980s. Imaging facilities were the most popular financial investments. The investigators found no instances to support the contention of proponents of self-referral that physician-owned facilities improved access for otherwise disenfranchised populations. All physician-owned facilities resided in affluent areas where there already was ample access to imaging care. The Inspector General also reviewed physician investment in facilities in Florida and found complementary results [3]. Utilization was higher in circumstances of self-referral for a range of imaging technologies. My own work with colleagues from Abt Associates and the American College of Radiology, generated from an insurance claims database of major U.S. employers' episodes of care for four clinical indications, had similar findings [4]. We compared the fraction of episodes in which imaging transpired for self- and radiologist-referring physicians and found that self-referral led to approximately four times the rate of utilization and cost of radiologist-referral for all indications. In the absence of evidence suggesting improved health outcomes related to higher rates of imaging, this persuasive research, within a few years, promoted policies intended to limit self-referral—the Stark II legislation restricting self-referral; safe harbor regulations defining the circumstances under which referrals could be made; nearly 30 state laws addressing self-referral; and a change in the opinion of the American Medical Association Council on Ethics and Judicial Affairs (AMA CEJA) on physician conflict of interest and self-referral arrangements.
Although modified in 1994, the essence of the AMA CEJA opinion is substantively unchanged from the 1992 version that states, in part:
Physicians are free to enter lawful contractual relationships, including the acquisition of ownership interests in health facilities, products, or equipment. However, when physicians refer patients to facilities in which they have an ownership interest, a potential conflict of interest exists. In general, physicians should not refer patients to a health care facility which is outside their office practice and at which they do not directly provide care or services when they have an investment interest in that facility. The requirement that the physician directly provide the care or services should be interpreted as commonly understood. The physician needs to have personal involvement with the provision of care on site [5].
The third through fifth sentences are particularly germane to Mitchell's [1] article in Health Affairs, since self-referring physicians would appear to be violating these sections by participating in the arrangements Mitchell describes. Doubtlessly, many of these physicians would disagree. That this is the case, speaks more generally to the larger issue of how difficult it is to curb any adverse practice by regulation. Regulation, by definition, must define precisely the terms of what is to be regulated and how. Inevitably, there will be ambiguity. Worse, since regulation is virtually always influenced by politics, there will be critical exceptions made, and that is the case with self-referral.
The in-office exception to the Stark II regulations and state laws, on which the arrangements described by Mitchell [1] are based, conveys the right of physicians to maintain imaging capabilities—expected at the time of the bill's passage to be largely plain X-ray and sonography—in their office practices. While hard to rationalize even then, given the research results, the exception recognized the political reality of how difficult it would be to pass the legislation if the law did not contain this exemption. There was no consideration of how practice might change to make more practical the acquisition of such high-technology techniques as CT, MRI, and PET as "office-based" instruments. In fact, the combination of corporatization of medicine, miniaturization of imaging techniques with associated price reduction, and the trend toward mergers of medical practices has put the acquisition of high-technology imaging within the financial reach of a large number of medical practices. Equipment manufacturers have taken advantage of these trends to market high-tech imaging devices to physicians on the basis of their projected financial return.
In fact, the acquisition of high-tech imaging capabilities has become the favored approach of nonradiologists' practices to replace lost revenue from declining reimbursement for their traditional services [6]. In pretty much all regions of the United States, physicians are becoming more entrepreneurial, even to the point of ceasing to provide poorly reimbursed traditional services in favor of higher-paying services such as imaging. Many are outsourcing interpretations to radiologists—at lower rates than they are receiving from insurers—and making a profit on the professional fees as well. Elevated technical fees for imaging are promoting this activity and facilitating the kinds of lease-by-the hour and "pay-per-click" arrangements described by Mitchell [1], which are in direct conflict with the AMA opinion detailed above and, as Mitchell notes, quite possibly with existing anti-self-referral legislation. In fact, such arrangements cannot be rationalized on the basis of quality of care, convenience, access to care, or any of the other explanations commonly offered by the apologists for self-referral. It's about the money and, if we accept that physicians are susceptible to financial incentives, in conflict with yet another AMA CEJA opinion addressing conflict of interest:
Under no circumstances may physicians place their own financial interests above the welfare of their patients. The primary objective of the medical profession is to render service to humanity; reward or financial gain is a subordinate consideration. For a physician to unnecessarily hospitalize a patient, prescribe a drug, or conduct diagnostic tests for the physician's financial benefit is unethical. If a conflict develops between the physician's financial interest and the physician's responsibilities to the patient, the conflict must be resolved to the patient's benefit [7].
Given Mitchell's [1] demonstration of the susceptibility to self-referring physicians to placing their own financial interests above patients' health interests, it's hard to be sanguine about the prospects for further regulation improving on the situation. As a sympathetic health economist once said to me, "Finding ways around regulation is the American national past-time" (Albert Williams, PhD, The RAND Corporation, personal communication, 1985). Closing the Stark II in-office exception is a noble regulatory goal, however, we must recognize that there are limitations to what regulatory actions can accomplish. History tells us that even if a Stark III were to pass Congress, there almost surely will be adverse and unintended consequences.
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