Tuesday, July 16, 2013 Self-Referral of Anatomic Pathology Cost Medicare $69 Million, Says GAO A new report from the Government Accountability Office (GAO) concludes that when physicians performed biopsies in their own facilities instead of referring the service to an outside lab, the number of procedures increased, and costs went up. GAO released "Action Needed to Address Higher Use of Anatomic Pathology Services by Providers Who Self-Refer" yesterday. This second of 4 reports in GAO's self-referral investigation covered anatomic pathology services between 2004 and 2010. Among the findings are that self-referred services more than doubled, while services referred externally increased far less (116% vs 38%); and spending was higher for self-referrals than for non-self-referral services (164% vs 57%). GAO estimated that the higher rate of procedures and higher number of services per biopsy by self-referrers cost Medicare $69 million. Additional findings and conclusions are in the report. "There is more than enough evidence that self-referral leads to over-utilization," stated the Alliance for Integrity in Medicare (AIM) today in response to the report. GAO recommended that the Centers for Medicare and Medicaid Services (CMS) track self-referred anatomic pathology services, create policies to ensure appropriateness of biopsy procedures, and develop new payment approaches. AIM said that while it applauds GAO's findings, it disagrees with these recommendations. "It's time to get at the root of the problem and close the self-referral loop." APTA is an AIM member. In its first report, GAO investigated self-referral in advanced imaging services, also concluding that financial incentives were a likely factor driving the increases in referrals and spending. APTA anticipates the last 2 reports in the series, on radiation oncology and physical therapy, later this year.