17 Leading EHR Vendors

Owning or leasing medical equipment was more likely to occur at larger group practices with more than 50 physicians, where 56% own or lease clinical lab equipment, 62% own or lease X-ray machines, and 53% own or lease advanced imaging equipment such as CT or MRI scanners. At these facilities, equipment can be used more consistently and costs recouped more quickly, a new report concludes.

The data, from the Center for Studying Health System Change's 2008 Health Tracking Physician Survey, was released last Wednesday. Under health reform law, beginning January 1 physicians are required to disclose their financial interest when referring Medicare and Medicaid patients for certain advanced imaging services, including MRI and CT scans, within their practices, and must also provide patients with a list of alternative suppliers.

The report also revealed that at practices with one or two physicians, 16% own or lease clinical lab equipment, 9% own or lease X-ray equipment, and 7% own or lease advanced imaging equipment.

The document notes that policymakers are concerned that physicians with ownership or other financial interests in medical facilities and equipment may make more referrals than medically necessary. It also said the Stark Act, which took effect in 1992 and was enacted to bar physician self-referrals of Medicare patients for clinical laboratory services, has lost its effectiveness.

"The Stark law was expanded to cover Medicaid patients and other health services, including inpatient and outpatient hospital services and radiology services. However, there are numerous exceptions to the self-referral prohibitions, most notably if the service is provided within the physician's office or practice," the report said.

"Since the enactment of the Stark laws, technological advances have allowed more services to be provided in outpatient settings, including physicians' offices. At the same time, the cost and scale of high-tech equipment, including advanced imaging equipment, such as computed tomography (CT) and magnetic resonance imaging (MRI) scanners, has declined, making office-based installations more feasible from a business perspective," found the survey.

The report relied on input from 2,750 physicians in community-based, physician-owned practices who were asked whether their main practice owned or leased equipment used for laboratory testing, including routine blood work; X-rays; other diagnostic imaging, such as CT or MRI scans; non-invasive testing besides electrocardiograms, such as echocardiograms, treadmill, nuclear testing, and sleep testing; and invasive procedures, such as endoscopy or cardiac catheterization.

Overall, 25% reported their practice owned or leased equipment for laboratory services, 23% for X-rays, 17% for advanced imaging, 29% for non-invasive procedures, and 11% for invasive procedures. Overall, almost one in seven physicians (13%) reported that their practice owned or leased three or more types of equipment.

The report noted that Congress and the Centers for Medicare and Medicaid Services have taken action to make physicians' ownership and use of some types of advanced imaging less attractive by cutting Medicare reimbursements.

It said that, "given the growing evidence that physician self-referral contributes to unnecessary and costly care, policymakers might reconsider the broadness of the in-office ancillary service exemption to the Stark law."

"Ultimately, moving away from fee-for-service payment toward payment mechanisms that reimburse physicians for a broader unit of service, such as an episode of care, or putting physicians at least partially at risk for the cost of care will alter the financial incentives that now encourage physician self-referrals," concluded the report.