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New image: payers hope prior authorization will reduce growing imaging costs.

Article Excerpt
The cost of imaging procedures tops $100 billion a year and is expected to double over the next four years, according to a white paper, "Ensuring Quality Through Appropriate Use of Diagnostic Imaging," produced by America's Health Insurance Hans (AHIP). Unfortunately, AHIP estimates that about half of the scans for certain conditions fail to improve patients' diagnoses or treatments.

A recent study by McKinsey Global Institute also indicates a trend toward inappropriate imaging, saying that diagnostics from magnetic resonance imaging (MRI) and computed tomography (CT) scans contribute $26.5 billion in unnecessary health services.

The numbers keep coming, even from the Medicare sector. The Government Accountability Office (GAO) reports a dramatic surge in high-tech imaging in Part B, such as MRIs, CT scans and positron emission tomography (PET) scans. Medicare spending for imaging services has more than doubled from 2000 to 2006, increasing to about $14 billion. GAO's recent study also points out the substantial variation in the use of services across regions, suggesting that some utilization is not necessary or appropriate.

John A. Patti, MD, vice chair of the American College of Radiology (ACR) Board of Chancellors, suggests that the industry not look at imaging costs as a separate silo but instead as an integral part of the evolution of healthcare.

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"Imaging is the fastest growing area in healthcare, but it detects disease earlier, thereby decreasing costs of delayed or inaccurate diagnoses, and should be expected to grow at a greater pace than the rest of healthcare," he says. "We can accept higher costs if imaging is done appropriately."

One more issue raising eyebrows is the growth of providing imaging services in physician offices. Physicians receive payment for the technical (capturing images) and professional (interpretation) components of the service. This trend may lead to referrals by physicians to facilities in which they have a financial interest....