Defining the Problem
One of the commonly voiced arguments against the implementation of MR-guided focused ultrasound is that it costs the hospital revenue compared to just performing MR imaging studies. The argument goes something like this: Because it takes one and a half to four hours to perform a focused ultrasound procedure versus 20 to 30 minutes per imaging study, 4 to 12 imaging studies can be performed in the same amount of time as a single focused ultrasound treatment. Therefore, some administrators may think that performing MR imaging studies is a more cost-effective use of MR time compared with focused ultrasound procedures.
To learn whether this cost-effectiveness argument could be true, the Foundation cost-calculator tool was used. This tool is designed to estimate actual cost versus the payment rate set by the Centers for Medicare and Medicaid Services (CMS) and/or commercial insurance carriers for specific MR-guided focused ultrasound procedures and the procedures or studies against which they compete clinically. The cost calculator tool was presented as part of the 2022 Symposium on Focused Ultrasound.
Using the tool, a simple MR imaging study was selected for comparison. On average, an MR imaging study costs a hospital outpatient facility $255 to perform, assuming a 30-minute treatment slot. This figure includes all costs associated with the study, such as amortized cost of the MR scanner, tech time, room costs, facility overhead, etc. CMS pays an average facility base rate of $368,* and an average commercial insurance payment per MRI is $1,000. Assuming a 50/50 patient mix between Commercial Insurance and Medicare patients, the facility will realize an average profit of $429 per study.
The profit gained from these imaging studies was then compared to five different MR-guided focused ultrasound procedures ranging from two- to four-hours in duration. Those five procedures were treatments for essential tremor, pain from bone metastases, and uterine fibroids, as well asl transrectal prostate ablation and transurethral ultrasound prostate ablation.
The difference in MR time was accounted for, meaning if the focused ultrasound procedure took two hours, four imaging studies could be performed in the same amount of time, so the profit from the focused ultrasound procedure was compared to the profit from four imaging studies.
For the focused ultrasound procedures, a 25/75 mix between Commercial and Medicare patients was assumed, rather than the 50/50 mix used for imaging, because therapeutic interventions in general are delivered to an older patient population than imaging studies.
As compared to the profit from the number of imaging studies that could be performed in the same amount of time as the procedure:
- Essential tremor, painful bone metastases, transurethral ultrasound ablation, and transrectal prostate ablation treatments generate $1,600 to $7,400 greater profit than would be realized if only imaging studies were performed.
- Uterine fibroid treatments lose almost $6,000 for the facility. This is due to the treatment’s low reimbursement level.
In conclusion, most focused ultrasound procedures are significantly more profitable for the facility compared to MR imaging studies even when accounting for the extra time required to perform them.
The Foundation encourages you to reach out to us to learn how the cost calculator tool might prove useful in realizing and accelerating the clinical adoption of MR-guided focused ultrasound treatments.
Mark Carol, MD, is a senior consultant at the Focused Ultrasound Foundation. If you have questions about this blog or the cost calculator tool, please feel free to contact him.
*None of the figures included have been adjusted to account for geographic location.