Medicare Cost-Saving Moves Can Backfire

Upping payments for bladder biopsies done in doctor's office boosted overall spending, study found

By Karen Pallarito
HealthDay Reporter

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TUESDAY, Feb. 9 (HealthDay News) -- After Medicare sweetened payments for simple office-based endoscopic procedures, doctors in one New York City practice performed many more in-office bladder biopsies, but the volume of hospital procedures stayed roughly the same, a new study finds.

So, instead of saving money, Medicare expenditures rose 50 percent after the U.S. Centers for Medicare and Medicaid Services (CMS) increased physician reimbursement for those outpatient procedures, researchers report in the March 1 issue of the journal Cancer.

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The finding could bolster the argument that some Medicare policies that try to lower costs this way may instead wind up boosting overall expenditures, the study suggests.

"Our study was not intended to be an indictment of physicians or American medicine, but instead to explore how changes in Medicare reimbursement might influence practice patterns," said study co-author Dr. Samir S. Taneja, director of the division of urologic oncology at NYU Langone Medical Center.

"Clearly the intent of CMS in instituting these specific reimbursement changes was to shift bladder cancer care and bladder biopsies from the hospital to the office as these are costly and frequent procedures," he said. "Overall, this should have resulted in a cost reduction."

The authors suspect that it did not reduce costs, in part, because there was a lower threshold for performing those in-office procedures after the reimbursement change.

Lead author Dr. Micah L. Hemani, a physician in the department of urology at NYU Langone Medical Center, explained that patients are often referred to urologists to investigate abnormalities, such as a small amount of blood in the urine. A test called a cystoscopy allows the urologist to look inside the bladder.

"After 2005, when we looked inside, we were more likely to take a piece of the bladder, burn something, or resect the tumor in the office," he said. "The threshold for actually intervening was much lower and it happened to coincide with this dramatic change in Medicare reimbursement."

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