Skip to main content
Accessibility|Contact|Privacy|Terms of Service

Closing Loopholes Allowing Physicians to Refer Patients to Enterprises in Which they Have Financial Stake

  • Published: 2015-01-12 : Author: Brown University : Contact: David Orenstein - david_orenstein@brown.edu
  • Synopsis: Ending the controversial practice might save the federal government hundreds of millions of dollars a year.

Main Document

"Observations on self-referrals of IMRT services for the treatment of prostate cancer were particularly disconcerting."

With findings from four recent reports by the Government Accountability Office, the new Congress could close dozens of loopholes that have allowed physicians to increasingly refer patients for medical services to enterprises in which they have a financial stake, write the authors of a new "Viewpoint" in JAMA.

Ending the controversial practice might save the federal government hundreds of millions of dollars a year.

The practice of "self-referral" has a logic, acknowledged article co-author Dr. Eli Y. Adashi, professor of medicine in the Alpert Medical School and former dean of medicine and biological sciences at Brown University. A doctor may have good reason to tell a wheezing smoker that he needs a CT scan of his lungs. If that doctor happens to own diagnostic imaging clinic in the same building, the logistical convenience for the patient and the rapid and seamless reporting of the results back to the doctor may be hard to beat. But is the CT scan truly necessary? Is that CT machine really the best one available to the patient at comparable cost? Will it be read by a radiologist or by a less well-trained technician? Given the financial ties involved, is the doctor's focus solely on providing the best care, or is it blurred by the chance to claim a greater share of the patient's - and Medicare's - money

"It is capitalism at its best and at its worst," Adashi said. "It's important to point out the uncomfortable relationship between money and medicine."

Policymakers have wrestled with the issue for decades.

Physician self-referrals grew rapidly in at least four categories of services, according to data reported by the US Government Accountability Office. Credit Brown University
About This Image: Physician self-referrals grew rapidly in at least four categories of services, according to data reported by the US Government Accountability Office. Credit Brown University
In 1989 and 1993, Congress passed two laws, nicknamed "Stark I" and "Stark II," that ostensibly prohibited physician self-referrals. But 35 exceptions have allowed the practice to thrive instead, wrote Adashi and co-author Dr. Robert Kocher, a senior fellow at the University of Southern California.

The GAO's series of reports, which concluded in June, found that for three different services - MRI and CT scans, anatomic pathology, and intensity-modulated radiation therapy - self-referrals gained substantial market share at the expense of non-self-referrals between 2004 and 2010.

"Observations on self-referrals of IMRT services for the treatment of prostate cancer were particularly disconcerting," Adashi and Kocher wrote. "The utilization of self-referred IMRT services increased by as much as 356 percent at a time when the utilization of the non-self-referred variety decreased by 5 percent."

In the long term, the authors note, self-referrals may decrease as health care payment models change from the current "fee-for-service" model to an alternative - such as accountable care organizations, in which doctors are rewarded for achieving quality outcomes in as cost-effective manner as possible. But that model shift will take years and might never happen completely.

Similar Topics

1 : The Difference in Hospital Meals Around The World : Sunbelt Staffing.
2 : Hospice Care Comparison Study : Indiana University.
3 : Nursing Homes Falling Behind With End-Of-Life Directives : University of Missouri-Columbia.
4 : Country and Health System Factors on RN and MD Personnel Production : New York University.
5 : Urgent Care Centers - Alternative to Emergency Rooms and Physician Visits : MD Now Urgent Care Walk In Medical Centers.
From our Rehabilitation and Hospitals section - Full List (112 Items)


Submit disability news, coming events, as well as assistive technology product news and reviews.


Loan Information for low income singles, families, seniors and disabled. Includes home, vehicle and personal loans.


Famous People with Disabilities - Well known people with disabilities and conditions who contributed to society.


List of awareness ribbon colors and their meaning. Also see our calendar of awareness dates.


Blood Pressure Chart - What should your blood pressure be, and information on blood group types/compatibility.





1 : Millennials Fail to Understand Dangers of Tanning
2 : Appetite Loss After Exercising Explained
3 : Bias Keeps Women with Higher Body Weight Away From the Doctor
4 : Smart Hoteliers are Building a Healthier Future
5 : Teaching Baby Sign Language - Nita, Show Us More
6 : MitoQ Novel Antioxidant Makes Old Arteries Seem Young Again
7 : Telemedicine Helps Overcome Healthcare Gender Based Barriers
8 : Screen Reader Plus Keyboard Helps Blind, Low-Vision Users Browse Modern Webpages


Disclaimer: This site does not employ and is not overseen by medical professionals. Content on Disabled World is not intended to be a substitute for professional medical advice, diagnosis, or treatment. Always seek the advice of a physician or other qualified health provider with any questions you may have regarding a medical condition. See our Terms of Service for more information.

Reporting Errors: Disabled World is an independent website, your assistance in reporting outdated or inaccurate information is appreciated. If you find an error please let us know.

© 2004 - 2018 Disabled World™