Physician self-referral for imaging and the cost of chronic care for medicare beneficiaries

Background As the cost of both chronic care and diagnostic imaging continue to rise, it is important to consider methods of cost containment in these areas. Therefore, it seems important to study the relationship between self-referral for imaging and the cost of care of chronic illnesses. Previous studies, mostly of acute illnesses, have found self-referral increases utilization and, thus, probably imaging costs. Objective: To evaluate the relationship between physician self-referral for imaging and the cost of episodes of chronic care. Research Design: Using Medicare's 5% Research Identifiable Files for 2004 to 2007, episodes of care were constructed for 32 broad chronic conditions using the Symmetry Episode Treatment Grouper. Using multivariate regression, we evaluated the association between whether the treating physician self-referred for imaging and total episode cost, episode imaging cost, and episode nonimaging cost. Analyses were controlled for patient characteristics (eg, age and general health status), the condition's severity, and treating physician specialty. Results: Self-referral in imaging was significantly (P < 0.01) associated with total episode costs in 41 of the 76 medical condition and imaging modality (computed tomography, magnetic resonance imaging, etc.) combinations studied. Total costs were higher in 38 combinations and lower in 3. Even nonimaging costs were much more often significantly higher (in 24 combinations) with self-referral than being lower (in 4 combinations). Conclusions: We find broad evidence that physician self-referral for imaging is associated with significantly and substantially higher chronic care costs. Unless self-referral has empirically demonstrable benefits, curbing self-referral may be an appropriate route to containing chronic care costs.