MedPAC Report Urges Prior Authorization for Advanced Imaging Services

June 16, 2011

The Medicare Payment Advisory Commission (MedPAC) has issued its June report to Congress and in the report, urges Medicare to implement a prior authorization program for clinicians who order more advanced imaging studies than their peers.

Citing the rapid volume growth of advanced imaging services over the past decade (including MRI, CT and nuclear medicine), the recommendation is designed to give the Centers for Medicare and Medicaid Services (CMS) a tool to improve payment accuracy for and ensure the appropriate use of advanced imaging services.  Recognizing a limit to CMS’s resources, the rationale notes that targeting outlier practitioners – rather than all providers – would reduce administrative costs and the burden on practitioners and beneficiaries.

Believing that the in-office ancillary services (IOAS) exception has contributed to the rapid increase in imaging and other tests, yet fearing that limiting the IOAS exception could inhibit organizations working to coordinate care within a physician practice, the Commission recommended additional changes to the current payment model in order to address mispricing and reduce financial incentives for investing in ancillary services.  These additional recommendations urge CMS to bundle payments for multiple services that are often furnished together, and reduce payment for the professional component of diagnostic imaging services provided by the same practitioner in the same session.

To view the entire MedPAC report:

To view Chapter 2: Improving payment accuracy and appropriate use of ancillary services: