Determinants of acquisition of MR imaging units in an era of prospective payment.

Abstract

A survey was undertaken to examine the impact of Medicare's Prospective Payment System (PPS) and other recent changes in the health care environment on providers' decisions regarding acquisition of high-cost technologic equipment. The survey group included 199 hospitals and freestanding imaging centers known to have acquired magnetic resonance (MR) imaging units, as well as a random sample of 400 hospitals whose acquisition decisions were unknown to the authors. Fifty-eight percent of the known adopters and 61% of the randomly selected hospitals responded to the survey. Nonadopters' decisions were dominated by economic considerations, including the high cost of MR imagers and concerns about Medicare's reimbursement policies. Competition and a desire to provide the highest quality of care are counterbalancing the retardant effects of PPS, however, and are stimulating widespread diffusion of MR imagers.

Adoption of high technology medical imaging and hospital quality and efficiency: Towards a conceptual framework

“…If the market where hospitals operate has, however, mechanisms in place to restrict and control the use of imaging, then the effect of physician supply and market size on adoption might not be as strong as that in a market without control policies. Examples of these mechanisms include reimbursement rates (and coverage), prior‐authorization requirements, and certificate of need . If stringent, these mechanisms can all reduce the revenue potential that a hospital can expect to derive from adopting a new technology.…”

“…Studies have proposed and demonstrated positive associations between investments in medical technologies and various measures of hospital performance . The provision of high‐quality care and the enhancement of diagnostic capabilities have been identified as significant factors affecting adopters' decisions to acquire medical technologies in hospitals . Hospitals are becoming increasingly reliant on technology to deliver high quality patient care, and diagnostic radiology, in particular, is recognized to be part of a larger system whose goal is to treat patients effectively and efficiently .…”

“…Based on this rationale, this framework proposes the supply of physicians in a market as a direct determinant of adoption of high technology medical imaging. It should be expected, however, that jurisdictional characteristics related to reimbursement policies and practices (eg, certificate of need) as well as payment structures moderate this relationship as they can have a direct impact on the demand for imaging testing . Even with a very strong demand for imaging, hospitals may not generate enough revenues to support adoption processes if operating in a jurisdiction with very restrictive control policies over the use of imaging.…”