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Life Health > Health Insurance > Health Insurance

Where the Health Care Money Is: Radiology

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The health care system seems to be keeping tracking of every cookie a consumer eats these days and every blood pressure check the consumer misses.

Primary care physicians feel as if they’re being put through a cost-saving meatgrinder.

One group that might be escaping some of the pressure is radiologists, and especially radiologists who conduct “advanced imaging” procedures such as MRIs and PET scans.

America’s Health Insurance Plans, Washington, has estimated that radiology accounts for about $100 billion in annual U.S. health care expenditures, and that that amount could double in the next 4 years.

Consultants at Milliman Inc., Seattle, have suggested in a report prepared for a unit of Magellan Health Services Inc., Avon, Conn. (Nasdaq:MGLN), that successful radiology benefits management (RBM) programs could save more than $13 billion by 2020 for the traditional Medicare alone.

One example of challenges with radiology claims costs is the famous problem of radiologist balance billing.

At the typical health plan, the patient has a very easy time finding an in-network hospital and a reasonably easy time finding in-network primary care doctors and in-network specialists. But, in many cases, a patient who enters an in-network hospital with the intention of seeing only in-network providers has a terrible time seeing in-network radiologists.

The radiologists often shun networks. Instead of accepting a plan’s estimate of the “reasonable and customary” rate for radiology services and taking the plan’s payment as payment in full, a radiologist often stuns the patient — who had worked hard to get only in-network care — by billing the patient for the balance.

The RBM companies are expecting to do more business in the next few years as rising costs, a soft economy and pressures related to the Patient Protection and Affordable Care Act of 2010 (PPACA) give public payers, private insurers and employers that sponsors self-insured plans a stronger incentive to squeeze out every dime of costs.

Kevin Howat, executive vice president of business development at Care to Care L.L.C., New York, says health insurance agents and brokers should be paying close attention to RBM trends.

“Studies have suggested that 20% to 50% of all imaging procedures are unnecessary,” Howat said. “There are huge savings to be realized and unnecessary patient risk to be avoided.”

Some Americans may have been taken aback earlier this year when they looked at websites that tried to put the amounts of radiation coming out of the earthquake-damaged nuclear reactors in Fukushima, Japan, into context and discovered that, in some cases. authorities were concerned about the possibility that nearby residents might be exposed to roughly the amount of radiation received during a typical CT scan.

Some patients who have gone in to receive diagnostic MRIs have been hit and killed by flying objects.

There are even some researchers who believe that routine ultrasounds might cause alarm fetuses and ought to be avoided except when clearly necessary.

But, at the same time, patients should get high-quality imaging when imaging is needed, Howat says.

In the Medicare Advantage program, for example, plans have to balance cost constraints with PPACA minimum medical loss ratio standards and a need to do well in the “5 Star” quality rating program, Howat says.

Benefits advisors helping employers add RBM programs to self-funded plans must be sure to emphasize the need for the radiology benefits manager to be physician friendly and know how to root out unnecessary procedures and expenses without bothering good radiologists and adding to “provider network noise,” Howat says.


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