The imaging market in the United States is estimated to generate more than $100 billion annually. While approximately 60% of the imaging volume is conducted within hospitals, making imaging a key source of revenue, there is increasing pressure from both public and private payers to shift more imaging procedures to lower cost ambulatory settings. This shift is taking place along with ongoing challenges that imaging administrators face, all with significant financial ramifications, from Medicare's Appropriate Use Criteria (AUC), surprise billing legislation and COVID-19's impact on imaging volumes.
The AUC program is cited as one of the top challenges for health systems and provider practices because it has been difficult to operationalize to avoid potential Medicare claim denials, resulting in multiple CMS delays for full implementation. The AUC program is part of the Protecting Access to Medicare Act (PAMA) of 2014 and is designed to ensure that advanced diagnostic imaging services – specifically, high-cost services for computerized tomography (CT), positron emission tomography (PET), nuclear medicine, and magnetic resonance imaging (MRI) – provided to Medicare beneficiaries are appropriate. The intent is to ensure that clinical guidelines are consulted up front, which will be a better way to avoid costs associated with unnecessary or inappropriate procedures than prior authorizations, a process that often leads to frustration and care delays. Ultimately, failure to comply with the AUC program will result in denied Medicare claims. While operationalizing the program presents several challenges, organizations can use patient access and revenue cycle solutions to help facilitate workflows that meet AUC program requirements.
The AUC program applies to all providers who order advanced diagnostic imaging services, as well as all providers and facilities that furnish those services. Under this program, at the time an order for advanced imaging is placed, the ordering provider will be required to consult a qualified Clinical Decision Support Mechanism (CDSM). CDSMs are the electronic portals through which providers access clinical guidelines or AUC. The CDSM will provide the ordering provider with a determination of whether the order adheres, or does not adhere, to AUC, or if there are no AUC that are applicable. The consultation information must then be included on the claim by the rendering provider and/or facility. Consultation information includes:
In addition to managing costs, a key reason for requiring the ordering physician to consult AUC is to provide ongoing education about procedure efficacy based on current clinical guidelines for the patient’s condition. For that reason, the rendering provider cannot consult AUC on behalf of the ordering provider. Yet, it is the rendering provider – typically a hospital – that bears the reimbursement risk when claims are denied for imaging services that do not adhere to AUC. This makes the program particularly challenging for health systems.
The AUC program is currently in the Education and Operations Testing Period, so claims will not be denied for failing to include proper AUC consultation information. Once the penalty phase goes into effect, currently scheduled for January 1, 2022, claims that fail to append this information will not be paid. Given the challenges with implementing the program and the ongoing effects of the pandemic, CMS has proposed a delay in the implementation date until at least January 1, 2023.
The concern for many health systems is that, according to the American College of Radiology, “whether unaware of the new mandate or reluctant to participate, many providers, both ordering and rendering are simply not prepared,” which will make compliance even more challenging. Therefore, it has fallen to health systems to provide education for their ordering physician base.
While the final ruling on the implementation date is due in November, the current January deadline is still looming. This article highlights several steps health systems can take now to prepare – leveraging best practices and revenue cycle technology – to facilitate a smoother transition once the AUC program is fully implemented.
Understanding that imaging providers, such as hospitals and health systems, bear the financial risk of not complying with the Medicare AUC program, it’s important to work with referring providers now to ensure the appropriate information is captured at the time of order. With proactive outreach and education, coupled with processes enabled by patient access technology, health systems can facilitate compliance, leading to appropriate reimbursement under the new program and stronger working relationships with their physician community.
Read the infographic to learn how digital orders streamline financial clearance, increase reimbursement and improve patient and provider experiences.
Maddie Corrigan is the Associate Product Manager, Patient Experience Solutions for R1 RCM.