NCPA - National Center for Policy Analysis


August 27, 2004

Insurers and health-care providers nationwide are watching to see if a managed-care experiment recently implemented by a Pennsylvania insurer will work.

Highmark, a not-for-profit insurer whose Blue Cross Blue Shield plans cover about 60 percent of patients in western Pennsylvania, announced last month it would only pay for imaging services where staff and equipment meet new, rigorous quality standards. It claims that steering imaging services to test centers with the most experience and trained staff will not only boost quality and safety but reduce imaging costs up to 25 percent a year.

Beginning next year, Highmark will:

  • Require providers to get authorization before ordering advanced imaging procedures for patients, and Magnetic Resonance Imaging (MRIs) and Computed Tomography (CT) scans will only be reimbursed at practices that perform at least five different kinds of imaging tests.
  • Only pay for CT or MRI tests at locations that make the testing available at least 40 hours a week, plus some Saturdays, and have at least one accredited radiologist on site during business hours.

Radiologists are already in short supply in Pennsylvania, which makes it tough for many medical groups, especially in rural areas, to meet the requirements. Furthermore, some doctors complain that the Highmark measures will not increase quality and decrease costs, but will instead do the opposite, say critics.

"It feels like a restraint of trade," says Charlene Kellerman, practice manager for Orthopedic and Sports Medicine or Erie, Pennsylvania. Though the group sees about 120 patients a day, it conducts only about 40 MRIs a month.

Source: Vanessa Fuhrmans, "Health Insurer To Target Scans For Cost Cuts," Wall Street Journal, August 19, 2004.

For WSJ text (Subscription required),,SB109277260041393842,00.html


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