In-Office Ancillary Services

AGA POSITION: Integrating services such as anatomic pathology into physician practices can improve patient care.


AGA Supports the In-Office Ancillary Services Exception

The AGA supports the current in-office ancillary services exception under the Stark self-referral laws, which allow physicians to own and provide services such as imaging, pathology and physical therapy. We believe that integrating services such as anatomic pathology into physician practices can promote coordinated care by providing patients with accurate and prompt results and improving quality of colorectal cancer screening through integrated tracking of adenoma detection rates. 

There is a strong movement to eliminate this current exception, which we believe could have unintended consequences for patients. Most recently, President Obama’s proposed budget for FY 2016 included provisions that eliminate the IOASE for services such as radiation therapy, physical therapy, advanced imaging, and anatomic pathology services.   If approved, the changes would prohibit practices from self-referral of these services unless the organization meets the definition of a “clinically integrated practice”.  This portion of the President’s budget proposal has not received consideration and similar budget requests failed to pass in previous years.

Recent studies support maintaining the IOASE by showing appropriate utilization levels and cost containment in physician offices.  In March 2015, the American Medical Association released a report conducted by Milliman that analyzed spending and utilization trends over a five year period.  The study concluded that the number of ancillary services provided in physician offices was significantly smaller than those billed to hospital settings, which indicates that any savings from eliminating the IOASE would be fairly small.  The analysis also showed that the per unit cost of providing these services was generally less when delivered in a physician office and utilization was increasing more rapidly in hospital outpatient departments.

Rather than eliminating the current exception under the Stark self-referral law, AGA believes that providing physicians with education and evidence-based guidelines, appropriate use criteria, and decision support tools is a better approach to ensure the appropriate utilization of these services. The AGA is a member of the Coalition for Patient-Centered Imaging, (CPCI), a coalition of physicians and provider organizations dedicated to high-quality care and support for the current in-office ancillary services exception. 

Reviewed: March 2015