What Do Medicare’s Policies Mean for Your Imaging Practice?

Back in August, Anthem decided they would no longer cover MRI and CT scans for outpatient services. Some of the factors that led to this decision might point to Medicare’s proposed rules for 2018 and could affect other private insurers policies.

At a Radiology Business Management Association’s annual meeting, Pam Kassing, MPA, the senior economic advisor at the American College of Radiology, untangled the reasoning behind these new policy strategies. She explained that the incorporation of the “site neutral” policy in Medicare’s Physician Fee Schedule (PFS) will be used “to create a PFS-like payment system for the use of new sites.”

Kassing said that this move is a response to the Medicare Payment Advisory Commission’s (MedPAC) observation of hospitals buying medical clinics, cardiology offices, and imaging centers.

“MedPAC thinks the hospitals are chasing the money, or someone is chasing the money, to make sure the hospitals that own these sites are going to get paid at the HOPPS rate,” Kassing said. “You will not get paid more or less by having these new sites. Why they didn’t just decide to pay them by the PFS, I don’t know. But now a new fee schedule is to be developed.”

Even preexisting off-campus facilities that relocate will be subject to the new schedule. “If you move, you’re considered new. It won’t apply to sites that merely expand their services, although CMS [Centers for Medicare & Medicaid Services] did propose as much last year without seeing the idea through to finalization,” said Kassing.

Kassing also warns that Medicare is likely going to lower their reimbursement for hospital outpatient services. As of now, CMS pays 50 percent of outpatient fees at new off-campus facilities. “Don’t expect it to stand,” said Kassing. “CMS has now said 50 percent is too high. They’re probably going to reevaluate, and it’s probably going to be lower.” For 2018, CMS will implement a “relativity adjuster” formula so that they will “set the payments at 25 percent of HOPPS.”

In response to this change, Kassing responded, “When we look at the data, we see that they want to pay for the technical component of a CT at $15 and a technical component of an MR at $35. No matter how you calculate this thing, there’s no way you should be paying [only] $15 for a CT technical component or $35 for an MR. There’s something wrong with your formula.”