A recent Medscape article promoting the use of in-office ancillary services (IOAS) by physicians as a way to "boost your income" has prompted a pointed response from APTA that describes how self-referral can increase health care costs and hinder patient access to the most appropriate care.
"In an era when policy makers, providers, and patients are all looking for ways to bring down health care costs, it appears that your article is advocating the opposite approach by encouraging referrals for the purpose of profit," writes APTA President Paul A. Rockar Jr, PT, DPT, MS. "Respected policy organizations, researchers, and budget analysts continue to provide evidence that show the abusive financial impact of self-referral."
APTA's comments were in response to a Medscape article titled "9 Ancillary Services That Can Boost Practice Revenue," a how-to piece that encourages physicians to consider adding in-house services including physical therapy to their practices. One health care accountant and business advisor quoted in the article advises doctors that "you could be making money on each service you've been referring out."
The article describes physical therapy as a service that could be added at an estimated cost of $25,000 "plus the cost of extra space," but could earn "about $500,000 per year." One consultant commenting on the idea of adding physical therapist services warned Medscape readers that "the high investment in equipment and staffing make for low profits," while another countered that the services could be useful "if you had a sports medicine practice or treated a lot of elderly patients."
APTA's response reiterates the association's opposition to self-referral in general and in particular to physical therapist services being included in the IOAS exception under the physician self-referral prohibition (the Stark self-referral law). The letter goes on to cite Office of Management and Budget estimates that closing these self-referral loopholes under Medicare could save the health care system $6 billion over 10 years.
"The expansive use of the IOAS exception by physicians in a manner not originally contemplated by the law undercuts the purpose of the law and substantially increases costs to the Medicare program and its beneficiaries," Rockar writes. "Physical therapy is not a same-day service. Your own article points that out when referencing the fact that physical therapy is often provided in multiple follow-up visits."
The Medscape article concludes by advising its readers that "none of these services is a slam dunk" in terms of potential profits, and that physicians considering adding any service be "ready to be challenged by specialists … who feel that others may not be qualified to provide the service."
APTA takes a different perspective on self-referral in its response. "APTA's foremost goal is to see patients continue to receive the highest-quality, most appropriate care while protecting limited Medicare resources,"
Rockar writes. "Closing the self-referral loophole will ensure that both goals are met without hurting true interdisciplinary collaboration."
In addition to physical therapy, the consultants recommended that physicians consider adding allergy therapy, urgent care, cosmetic services, medication dispensing, radiography, lab testing, weight loss services, and diabetes counseling.
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