by Frank J. Papatheofanis MD, MPH, PhD
The future of molecular imaging depends on the ability of practitioners and payors to solve the puzzle of PET reimbursement and referrer education.
Rarely during the recent upheavals concerning medical practice
and management has a community of practitioners been so whipsawed
by changes in reimbursement policy regarding one of its services.
Positron emission tomography (PET) continues to be at the center of
controversy regarding its payor coverage and reimbursement. Parties
as diverse as manufacturers, patient advocacy groups, and
government officials have joined physicians and scientists trying
to argue a case to support widespread availability of this imaging
tool.
The latest salvo in the ongoing struggle to gain payor
acceptance concerns changes in the fee structure for fluorine
18-labeled deoxyglucose (FDG), the most common radiopharmaceutical
employed for positron imaging. The 4 to 40 mCi dose of FDG is now
(April 2002) reimbursed by the Centers for Medicare & Medicaid
Services (CMS) at $475. This includes reimbursement for HCPCS C1775
and APC 1775; FDG is classified under the G code billing structure.
A pro rata discount in 2002 may have brought reimbursement to $389,
a reduction of approximately 18%. In addition to lowering the
reimbursement rate for FDG, which retails for $500 to $600, CMS
lowered its reimbursement for PET imaging at the close of 2001. PET
imaging services (outpatient, hospital outpatient prospective
payment system [HOPPS]) were reassigned to APC 0978, New
Technology-Level IX ($1,250-$1,500), which resulted in a payment
rate of $1,375 (down from $2,331 for 2001). However, last month,
CMS announced it will cover a bundled fee of $1,850 per PET
procedure, representing a contribution of $475 for FDG and $1,375
for imaging.
Table. codes for Medicare reimbursement of position emission tomography procedures.
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These seeming losses to the PET imaging community are partially
balanced by the introduction of new PET indications that qualify
for reimbursement. The accompanying Table lists current
reimbursement (a reimbursement code for recurrent breast cancer
also will be released soon). Moreover, ongoing discussions at CMS
may lead to acceptance of broader coverage for this medical
technology.
At $1,850 per study, many imagers are indicating that the
reimbursement level is too low and does not cover their own costs
for performing and interpreting the study. The average outpatient
PET imaging facility performs approximately 2.7 studies per day,
representing a billable average of $4,995. A center that operates
at this rate stands to bill approximately $1 million per year for
200 service days. Many estimates suggest that operating a PET
center typically involves $1.5 to $2 million per annum. This
includes physician fees, technician salaries, equipment
depreciation, and many other direct and indirect costs.
Consequently, even if 100% of CMS charges for PET services are
collected, the average outpatient center loses any possibility of
profit.
Clearly, this bleak scenario assumes an outpatient setting where
CMS is the sole reimbursement source. The inpatient imaging setting
and private payor reimbursement make the possibility of some degree
of profitability more likely, however minimal. Clearly, there is no
quick fix or resolution of this reimbursement conundrum.
Strategic Implementation
While reimbursement and coverage issues continue to play out and
mature, what decisions should imagers make concerning their
adoption of PET? Many new private, outpatient PET imaging centers
have begun to operate around the country. Likewise, the retail
price of FDG continues to slowly fall. Will the efficiencies of
widespread PET availability drive the cost of performing a study
low enough that some profitability will emerge? Will these
outpatient centers have to accept a high proportion of cash-paying
patients and not accept CMS or other payor reimbursement? Many of
these issues perplex the entrepreneurial radiologist hoping to
attract PET services to his or her practice.
PET continues to offer the possibility of diagnosing disease and
the results of disease treatment more accurately than existing
techniques such as CT or MRI. Particularly in the setting of
oncology, PET represents a potentially powerful tool for meeting
the needs of patients and those who care for them. PET utilization
in the United States has languished for many disparate reasons.
Perhaps the most important reason remains the lack of useful data
concerning clinical outcomes and other clinical evidence of the
effectiveness of PET.
The PET community deserves accolades for attempting to redress
the current state of slim to minimal evidence to support the use of
this technology. Payors continue to require clinical evidence of
utility, metrics more difficult to demonstrate with an imaging tool
than a therapeutic product. However, these are the standards
currently being used by payors.
The economic issues surrounding PET reimbursement and coverage
will lessen once clinical evidence of its utility becomes
available. Payors such as CMS hold all technologies to common
evaluation standards, and these standards apply to PET as well.
Reimbursement for PET will stabilize, and potentially increase,
once payors understand the contribution of this technology to
disease management.
Seeking Balance
The PET community should seek a balance between coverage and
reimbursement. Expanded coverage with lower reimbursement may not
be the most appropriate path for this technology. Higher
reimbursement with less expansive coverage may be a useful tactic
to pursue while data are developed, studies are performed, and the
usefulness of PET is communicated to patients and ordering
physicians.
What remains of the future of molecular imaging and the hope of
an expansion in clinical PET imaging? Much remains in this regard
if appropriate evidence is obtained and appropriately interpreted.
Much remains if clinical outcomes are tracked in clinical
investigation that attempts to measure the technical features and
diagnostic accuracy of the technique. Much also remains if PET is
successfully integrated within the critical pathways and patient
evaluation approaches that guide clinical trainees as well as
advanced practitioners.
Reimbursement for PET imaging will not likely increase without
demonstration of its overarching clinical utility. The installation
of new PET imaging centers around the country may drive the cost of
PET imaging down so that charges can represent the cost and
reasonable profit. Overall, the future of PET lies in education. It
lies in educating clinicians concerning its utility and payors
concerning its cost-effectiveness.
Frank J. Papatheofanis, MD, MPH, PhD, is associate professor of radiology and director, Advanced Medical Technology Assessment and Policy Program, UCSD Comprehensive Cancer Center and Whitaker Institute of Bioengineering, University of California, San Diego.