The General Accounting Office (GAO) has released a new report on trends in Medicare imaging services, the growing use of imaging services in physicians' offices, and management practices from private insurance payers, which the GAO feels might benefit Medicare.

The report analyzed Medicare claims data from 2000 through 2006. According to the report, in that time period Medicare spending for imaging services paid for under the physician fee schedule more than doubled, reaching a cost of approximately $14 billion. The GAO report lists several factors contributing to the rise in imaging costs for Medicare including more beneficiaries obtaining imaging services and the average use per beneficiary increasing. In particular, spending on advanced imaging--CT scans, MRIs, and nuclear medicine--rose far faster than standard imaging of ultrasound and X-ray. On average, Medicare pays physicians more for both the technical component (performing the imaging) and the professional component (interpreting the imaging) on advanced imaging than the standard imaging techniques.

As to why imaging use and advanced imaging services in particular have increased, the physician specialty organizations the GAO interviewed attributed the growth to the following:

-technological innovation--equipment becoming smaller and more portable;
-patient demand influenced by direct-to-consumer advertising;
-defensive medicine to protect physicians from malpractice suits;
-increase in clinical applications;
-older invasive diagnostic procedures replaced with new, less invasive imaging procedures.

In addition, representatives from private health plans cited two other factors for the growth in imaging spending--the ability of physicians to refer patients to their own practices for imaging and that primary care physicians often lacked knowledge about the most appropriate test to order for a patient, leading to a significant portion of imaging tests that may be unnecessary by clinical guidelines.

The GAO also critiqued the fact that a larger share of Medicare Part B spending for imaging services has shifted from the hospital settings--where the institution receives payment for the technical component of the service--to physician offices, where physicians receive payment for both the technical and professional components of the service. The GAO says that in-office imaging spending had significant variations depending upon the region, which also indicates that significant portions of imaging utilization are not necessary. The variations ranged from $62 in Vermont to $472 in Florida.

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