Healthcare costs in the U.S. were estimated to be more than $2.6 trillion in 2012; Centers for Medicare and Medicaid reported a further increase of 5.3 % in these staggering expenditures by the year 2014. The reasons for Americans spending so much money on health care are diverse and complex, and stakeholders hold different views about these causes. However, some factors are quite clear and unanimously agreed upon. Amongst these factors, one main determinant is higher prices of medical procedures.

Insurance companies continuously strive to seek ways to control the prices of diagnostic procedures; in one such effort Anthem recently introduced a policy, named as the “Imaging Clinical Site of Care Review Program”. The new imaging policy was initially rolled out in 4 states including Kentucky, Indiana, Wisconsin Missouri followed by five more states later in the year. Anthem plans to expand this program further to California, Connecticut Maine, and Virginia in March.

The program entails that people insured with Anthem must avail imaging services (only MRI and CT scan, not X-rays or mammograms) at free-standing facilities and not hospital-based ones. The policy restricts people to use hospital imaging services if there is an alternative facility within the radius of 30 miles, the only exception being an emergency situation or a valid clinical reason.

Hospital administrations are raising several concerns about this program, foremost being that it disrupts the continuity of care of patients and steers the patients to facilities that may not be able to fully capture their clinical condition. The situation is more problematic for some groups of patients, for example in children, as they may need sedation before some diagnostic procedures and radiation doses adjusted according to their age and weight. Hospitals also contend such free-standing facilities because hospitals also rely on income generated through these profitable services to provide non-profitable services like emergency and trauma at subsidized rates.

On the other hand, insurance companies assert that such programs are aimed at controlling the medical imaging related costs without compromising patient safety and quality of care. According to the insurer, such programs can help in saving hundreds of dollars in imaging services and considerably lower the premium of the health plans for the members. Cost estimation of imaging procedures by independent research bodies in hospital-based versus freestanding outpatient facilities also supports this argument.  Average cost of an imaging procedure like CT scan of the knee joint that cost 300-350$ in a freestanding outpatient facility may cost in the range of 1000 to 1100 $ in a hospital-based imaging service. According to the survey conducted by Healthcare Financial Management Association, the average bills for MRI and CT scans were 70 percent to 149 percent higher at hospitals as compared to an outpatient facility.

 

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