AIM Coalition Applauds New Study on Physician Self-Referral of Physical Therapy Services

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Patients who receive care from self-referring physicians for the treatment of low back pain (LBP) are more likely to be referred for some form of physical therapy, but that's just part of the story. According to newly published research, LBP patients who are self-referred receive fewer physical therapy visits and more ineffective passive modalities than patients who aren't self-referred—and all at a higher overall cost.

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AIM hopes that, combined with the GAO report from August 2014, this study will once again underscore for policymakers the fact that self-referral is a real and serious problem that drives up costs with no benefit to patients.

The Alliance for Integrity in Medicare (AIM)—a broad coalition of medical specialty, laboratory, radiation oncology, and medical imaging groups—applauds a new study that looks at the physical therapist (PT) services component of low back pain (LBP) episodes of care, and whether the episode was overseen by a self-referring or non-self-referring provider. The study was e-published in the July 2015 issue of the Forum for Health Economics and Policy. The study can be viewed here:

The study is not only timely, but also offers a new look at self-referral in physical therapist services, filling in many gaps that the U.S. Government Accountability Office (GAO) was not able to address in the study it published last year. This new research examines not only a different demographic but also identifies a common episode of care that is comparable across the spectrum.

Researchers examined 158,151 LBP episodes for patients covered by Blue Cross Blue Shield of Texas. They found that physicians who “self-referred”—that is, referred their patients to a business with which they have a financial relationship—referred 26% of their patients to physical therapy. Non-self-referring physicians referred 10% of their patients. It is telling that a patient was 2.6 times more likely to receive physical therapy when a self-referring physician was involved. The study also found that non-self-referred episodes of care were far more likely, 52% as opposed to 36% for self-referrers, to provide “active” physical therapist services. This, according to the study’s authors, suggests the care delivered by PTs in non-self-referred episodes is more tailored to promote patient independence and a return to performing routine activities without pain. It is important to note that not only can “passive” treatments be performed by a person who is not a licensed physical therapist (PT), but the authors also cite considerable evidence that these passive physical therapy modalities are “ineffective” in treating LBP.

When comparing the full episode of care between self-referring physicians and non-self-referring physicians, the study found that self-referring episodes cost, on average, $889 compared with $602 for non-self-referring episodes. When looking specifically at physical therapist services, the average cost was $144 for self-referring providers and $73 for non-self-referring providers. Not only are self-referring providers more likely to refer for physical therapy, they are likely to refer for fewer treatment sessions and provide less effective passive treatments, ultimately resulting in higher costs on average for the entire episode of care.

AIM hopes that, combined with the GAO report from August 2014, this study will once again underscore for policymakers the fact that self-referral is a real and serious problem that drives up costs with no benefit to patients. The ongoing misapplication of the IOAS exception for physical therapy, anatomic pathology, advanced diagnostic imaging, and radiation oncology services continues to be of grave concern to AIM. Furthermore, the Coalition’s position has been corroborated by independent evidence, including GAO reports and peer reviewed published research, which consistently demonstrates that the existing IOAS physician self-referral loophole results in increased spending, unnecessary utilization of medical services, and potentially compromised patient choice and care, which erodes the integrity of the Medicare program.

The coalition includes the following organizations: The American Clinical Laboratory Association; American College of Radiology; American Physical Therapy Association; American Society for Clinical Pathology; American Society for Radiation Oncology; Association for Quality Imaging; College of American Pathologists; and Radiology Business Management Association.

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Erin Wendel
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