Capitol
Issue Background

Ancillary Services

Protect Patient Access


Congress should utilize data and quality tools currently being employed by physician organizations to provide incentives for physicians to deliver high quality care, and should oppose any change to the in-office ancillary services exception in the Stark Law.

The In-Office Ancillary Service (IOAS) exception to the Stark Law allows orthopaedic surgeons to provide imaging and physical therapy services in our offices, vital for providing efficient diagnoses and treatments. A number of organizations, studies, and Congressional offices have evaluated the IOAS exception as a way of cutting costs (the Obama Administration estimated that repealing the exception would result in $6.1 billion in savings over 10 years). When calculating the cost of limiting the IOAS exception, we believe it is important to consider several different factors. First, limiting the IOAS exception would result in the shifting of care towards more expensive settings, raising costs to Medicare beneficiaries and the program significantly. In fact, it is estimated that Medicare would incur increased hospital outpatient costs of over $112 million annually for CT scans and MRI services that were previously provided in lower cost settings.

Physician Ownership of Ancillary Services Enables:

  • Better physician oversight of the quality of care being delivered
  • Improved care coordination through shared knowledge of patient and case information
  • Greater patient adherence to treatment plans by eliminating scheduling delays, prolonged waits, and the need to travel to other offices, which is critically important for orthopaedic patients with mobility issues, especially those who are elderly
  • An integrated care model that combines healthcare providers of various fields to promote a team-based approach to musculoskeletal care delivery

When Calculating The Cost of Limiting The IOAS Exception, It Is Important To Consider:

  • Limiting the IOAS exception would result in lower quality care and the shifting of care towards more expensive settings, raising costs to Medicare beneficiaries and the program significantly (it is estimated that Medicare would incur increased hospital outpatient costs of over $112 million annually for CT scans and MRI services that were previously provided in lower cost settings)
  • Several studies indicate that physical therapy services in physician office settings cost less on average per episode of care compared to similar services performed in outpatient settings or independently owned physical therapy settings
  • Without access to in-office ancillary services, patients would be forced to receive ancillary services in new and unfamiliar settings with the probability of a less precise diagnosis, increased inefficiencies, and barriers to appropriate screenings and treatments
  • Especially for some of the most vulnerable in our population, such as the elderly or those with mobility issues, the IOAS exception is critically important in providing access to health care as it also eliminates scheduling delays, prolonged waits, and the need to travel to other offices

The AAOS and Other Medical Organizations Are Invested in Quality Initiatives to Ensure the Highest Quality Services Are Performed On Their Patients. These Initiatives Include:

  • The development and implementation of training guidance
  • Clinical practice guidelines
  • Appropriate use criteria
  • Decision support tools, which support physicians in delivering the most appropriate care