Medicare cracking down on physician self-referrals

CMS is lowering the boom on physician self-referral, setting plans to ban Medicare payments for many self-referred services.  New CMS rules on this subject, which are part of regs proposed for the 2008 Medicare Physician Fee Schedule, would take effect as of January 2008. Changes include adding an anti mark-up restriction on interpretation of imaging studies, while eliminating the requirement for on-site reading.

CMS officials say that they're concerned about self-referral's potential for giving physicians the incentive to order unnecessary tests. And they have their eye on studies like the recent one by McKinsey, which estimates that physicians have been making $8 billion a year through the practice. Observers, meanwhile, say the proposal is already having an impact on doctors' business arrangements--and that many physicians are putting the brakes on self-referral-based deals entirely.

To learn more about CMS's plans:
- read this Kaiser Daily Health Policy Report article

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