Imaging reimbursement is unpredictable

Medicare is bound by Congressional action and by what is reasonable and necessary, according to a CMS official.

Issue: September 2006

WASHINGTON — As the role of imaging expands in medical care, doctors may wonder how much will be reimbursed through Medicare, but the Centers for Medicare and Medicaid Services is not prepared to provide solid answers.

“In the world of imaging the reimbursement climate is somewhat stormy,” Steve Phurrough, MD, director of the Coverage and Analysis Group at the CMS, said.

Phurrough addressed a gathering of cardiovascular imaging specialists and others at the 4th Annual Cardiovascular Magnetic Resonance and Computed Tomography conference here. He told the audience that his talk would not be filled with good news.

“The biggest difficulty you face is the lack of knowledge about what’s going to happen next,” Phurrough said. “How can you plan your future based on a reasonable expectation about what your reimbursements will be? The agency does not have a good answer for that; these are mostly issues that are dictated by legislation. Our system of paying for health care is one that has been patched together in a progressive fashion, and as you know patching things together does not necessarily result in a system that works for everyone’s benefit.”

Phurrough said CMS would soon be issuing a guidance on collecting clinical data about the effects of imaging, and he encouraged doctors to submit clinical trial results.

“We do have some concerns about expansion of this technology beyond what the current evidence demonstrates, so we will be looking for solid research,” Phurrough said.

The cost of technology

Phurrough said that new technology is the driving force of rising health care costs. A survey of economists found that 81% identified it as the primary cost driver. According to various estimates, technology accounts for 18% to 33% of the growth in health care costs.

However, it could also drive a decline in mortality. In a graph Phurrough displayed during his presentation, he noted that much of the reduction in mortality seen in the first half of the 20th century was due to decreased infectious diseases and a cleaner environment. The reduction continued through the second half due to better treatment of cardiovascular disease and low-birth-weight infants.

Now interest has turned to whether technology can further reduce mortality rates in the 21st century.

Phurrough said cost is not a factor when deciding whether Medicare will cover a procedure or service, but the agency will demand value.

“Today more than ever, we must get more for what we spend on health care,” Mark McClellan, MD, CMS administrator, said in a written statement displayed by Phurrough.

Reasonable and necessary

Phurrough said the basis for a Medicare coverage decision is whether a procedure or service is reasonable and necessary.

“FDA’s mantra is safe and effective. In Medicare, the mantra is reasonable and necessary,” Phurrough said. “Reasonable and necessary has never been defined, and in general it seems like the public does not want us to define it because then we would all have to live with that definition.”

Coverage decisions are first proposed, followed by a 30-day comment period. Phurrough said CMS typically receives a number of form letters during a comment period, which are reviewed and recorded, but are seldom persuasive.

“However, if you really want to make an impact, I suggest you go to our Web site and write what you think we should know yourself,” Phurrough said. – by Jeremy Moore

For more information:

Phurrough S. The CMS perspective on coding, coverage and reimbursement for imaging services. Presented at the 4th Annual Cardiovascular Magnetic Resonance and Computed Tomography; June 24-27, 2006; Washington.