It is no easy task to hit a moving target, so the seven speakers who presented the refresher course, “How Payment Policy Will Impact Technology Development in the 21st Century,” on November 30, 2010, at the annual meeting of the RSNA in Chicago, Illinois, diligently colored in the background of the canvas, offering insight into the anatomy of a CPT® code, a review of the successful campaign to get a code for CT angiography, and a postmortem on the recent attempt to get CT colonography reimbursement from Medicare.
When the talk turned to delivery models, Christopher G. Ullrich, MD, chair of the ACR utilization management committee and a neuroradiologist with Charlotte Radiology in North Carolina, had some real-world observations and thoughts on one of health-care reform’s key abstractions: accountable care organizations (ACOs). He subtitled his talk, “Quo Vadis.”
Ullrich observes that all current CMS demonstration projects are using fee-for-service payment and relying on resource-utilization management to reduce costs. Payors are currently bearing the cost of radiology benefit management (RBM) programs (and ignoring providers’ compliance costs), he adds.
The programs serving as poster-child models of health-care reform—such as those at Geisinger Health System (Danville, Pennsylvania); Mayo Clinic (Rochester, Minnesota); and Marshfield Clinic in Wisconsin—are based on current levels of reimbursement and would be unsustainable at, for instance, 30% less than Medicare payment levels, as recently threatened. Because they are typically the largest employer in most communities, Ullrich says, hospitals possess unequaled political clout in the health-care sector, as witnessed by a 3% to 4% pay increase since 2000, compared with physicians’ net loss.
“Continually paying less is not, in fact, a sustainable strategy,” Ullrich states. “Better methods of practice, efficiency, rightsizing, and a variety of other strategies are the only real ways to move forward in taking care of our patients.”
With radiology accounting for roughly 7% of health-care costs, the successful management of the utilization of radiology will be a requirement of any successful ACO. Drug costs, physician referral, and emergency-department utilization, however, are much higher on the priority list, Ullrich notes, even as radiology finances the change.
Making it up as we go
High levels of uncertainty prevail as health-care providers attempt to prepare for a rule that remains largely unwritten by the DHHS secretary. Ullrich identifies three scenarios for reimbursement that are being floated. One is hospital ACO payments, per beneficiary, per month—essentially, capitated care, which most organizations have demonstrated that they do not know how to manage. They probably would suffer, should that be the path.
A second model is bundled payment for episodes of care, and the question is how radiology’s portion will be calculated. Currently, it’s fee-for-service payment with a portion withheld; if savings are substantial, radiology gets a share of the savings. “There are very few models, but this looks a lot like an HMO of 1998 to me,” Ullrich says. “I watched multiple multispecialty clinics go broke with this arrangement, trying to make it work.”
In a third model, the ACO negotiates fee-for-service reimbursement with a payor. This is a scenario in which radiology will be challenged to protect its relative share. “If the RBM isn’t used (perhaps that’s a factor), this is essentially what we do now: direct negotiations,” Ullrich notes. “Because there are no working models, radiology could possibly be in the forefront of creating the model.”
Ullrich urges radiologists to stay abreast of the demonstration projects sponsored by the Center for Medicare and Medicaid Innovation (CMMI), which made its first eight awards at the end of November 2010, rather than speculating on which models (most of which are currently in practice) will be used to deliver accountable care.
Whether an ACO is managed by a hospital or by a physician network is less important than this question, Ullrich says: “How will we survive in this brave new world? We can become more productive, participate in capitation or risk sharing, provide value-based services or management of utilization within an ACO, or become a hospital or clinic employee.” Ullrich is pleased to report that about 70% of the audience prefers the ACO option.
Medical homes are one of the ACO models being