Duke 2008 | ASHE | Equity and Efficiency in Health and Healthcare

Diagnostic imaging, which encompasses many high–tech, expensive procedures such as magnetic resonance imaging (MRI), computed tomography (CT), positron emission tomography (PET), and radionuclide myocardial perfusion imaging (RMPI), represents the fastest growing component of medical expenditures in the United States, increasing at an annual rate of 9% in recent years.

Self-referral arrangements, whereby non-radiologist physicians prescribe and bill third party payers for imaging procedures, are believed to account for a significant share of the increased utilization and cost. Other factors that have contributed to the rapid growth in imaging include: more compact scanners, physicians practicing defensive medicine, convenience of in-office imaging, aggressive marketing by manufacturers, and profitability of the procedure (MedPAC, 2005.) Although more widespread use of advanced imaging may have significant positive effects on patient care, the rapid growth in use of and associated payments for advanced imaging are of great concern to both private and public insurers because the increased utilization is one of the driving forces behind escalating health insurance premiums.

In an attempt to rein in usage of advanced imaging procedures, private insurers are increasingly contracting with radiology benefit management programs (RBMs) to conduct prior authorization and utilization review of all physician requests for outpatient CT, MRI, nuclear cardiology, PET and CT angiography. Physicians must submit requests for these procedures to the RBM, which employs an algorithm to compare each request with criteria—for example, those developed by the American College of Radiology. A request deemed inappropriate is denied. Although many private insurers have adopted RBMs, well-designed evaluations regarding the impact of such programs on utilization and expenditures per beneficiary are non-existent.

This study will analyze claims data from Blue Cross of Idaho for the years 2003-2006 to evaluate the effects of a RBM implemented in early 2004 on utilization and expenditures for CT, MRI, PET and RMPI. Examination of the Blue Cross of Idaho program is of particular interest because the insurer gave employers the option to enroll in the RBM; those who enrolled were required to pay an additional fee per member. Employees of firms that opted out of the RBM program form a natural control group that can be compared with those enrolled. In contrast, nearly all other private insurers require that all plan members enroll in the RBM. For selected procedures, the analysis will compare changes over time in utilization and expenditures using a difference-in-differences (DinD) approach. The DinD methodology controls for the independent effects of secular trends and initial differences in use (expenditures) between RBM participants and non-participants. Importantly, the analysis will control for self-referral status of the provider and thereby disentangle the effects of the RBM from any confounding effects linked to self-referral. Most RBM programs do not explicitly prohibit the practice of self-referral. Results from this study will demonstrate whether RBM programs are effective in controlling escalating expenditures linked to the provision of advanced imaging, and if such programs could be improved by revising the appropriateness criteria to address the practice of self-referral.