As managed care companies continue to follow Medicare's lead by ratcheting back reimbursements for imaging, radiologists across the country are fighting back.

Late last year, radiologists successfully convinced managed care giant Humana, based in Louisville, Ky., to roll back its decision to eliminate reimbursement for the technical component of the second and third scans of contiguous body parts. Humana had gone much further than Medicare, which in 2006 reduced the reimbursement on second and third scans to 75 percent of the first scan.

"Humana was pretty dug in," says Christopher G. Ullrich, M.D., chair of the ACR's Managed Care/Private Payer Relations Committee. "As they faced a provider revolt, they ultimately softened."
Ullrich expects managed care companies to continue cutting imaging costs wherever they can. He notes that the ACR is in discussion with Minneapolis-based UnitedHealthcare to roll back its reimbursement cut, which has set the reimbursement rate for the technical component of the second and third scans at only 50 percent of the first one.

"We will continue to see very active efforts to cut imaging," Ullrich says, noting that the Managed Care Committee also hopes to convince private payers to consider other reimbursement models, rather than relying on the flawed Medicare formula.

Cuts in the reimbursements for scans of contiguous body parts are only the latest indication of a concerted effort between government and private payers to reduce imaging costs. That effort kicked into high gear with the passage of the Deficit Reduction Act (DRA) in 2005.

The bill -- passed in the final days of the Congressional session in closed-door meetings, without public hearings or input from groups targeted by the cuts -- did three things that impacted radiologist reimbursements:

* The bill capped reimbursement for the technical component of the Medicare Physician Fee Schedule, effective this year. For many imaging procedures, the capped rate is the lesser of the Medicare Physician Fee Schedule rate or the rate for the same procedure in the Hospital Outpatient Prospective Payment System (HOPPS), based on information provided by the hospitals. HOPPS rates often are lower than those in the Medicare Physician Fee Schedule by as much as 40 percent. The technical component payment covers practice expenses, including clinical staff time, supplies, and equipment and typically represents as much as 70 percent of the overall payment for the medical imaging procedure.

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