From the U.S. Government Accountability Office, www.gao.gov Transcript for: Medicare Prostate Cancer Treatment Costs Description: Audio interview by GAO staff with James Cosgrove, Director, Health Care Related GAO Work: GAO-13-525: Medicare: Higher Use of Costly Prostate Cancer Treatment by Providers Who Self-Refer Warrants Scrutiny Released: August 2013 [ Background Music ] [ Narrator: ] Welcome to GAO's Watchdog Report, your source for news and information from the U.S. Government Accountability Office. It's August 2013. Self-referral—which is when a doctor refers a patient to an entity or a specific treatment in which the doctor has some kind of personal financial interest—is generally prohibited under Medicare rules. However, an exception allows doctors to self-refer prostate cancer patients to a certain common but costly treatment. A team led by James Cosgrove, a director in GAO's Health Care team, recently examined the effects of self-referral on the types and costs of treatment for Medicare beneficiaries. GAO's Sarah Kaczmarek sat down with James to learn more. [ Sarah Kaczmarek: ] For a Medicare beneficiary with prostate cancer, what's the difference between a self-referral for treatment and a non self-referral? [ James Cosgrove: ] First of all, a beneficiary wouldn't know. When we talk about self-referral, what it means is that the physician or a family member of the physician has a financial interest in the entity that's going to be doing the treatment. Now, generally under Medicare, those types of arrangements are prohibited, but there are certain exceptions. And so what this report focuses on are cases where it is allowable for providers to self-refer for this particular treatment. [ Sarah Kaczmarek: ] And your team looked at a proportion of prostate cancer patients referred for a costly treatment based on whether their provider self-referred. What did you find in terms of the treatments patients received? [ James Cosgrove: ] You know, first of all, prostate cancer is very common. It's the second most common form of cancer for men—1 in 6 men over the course of their lifetime probably will be diagnosed with it. And for most men, there are multiple treatment options available and generally all of them are considered appropriate and perhaps equally effective. So there are things like IMRT, which is a form of radiation therapy that we looked at. There's surgery, where the prostate is totally removed. There's brachytherapy, where radioactive seeds are implanted. Active surveillance, just watching. And in general, one of the things that distinguishes these treatments, they have a variety of different side effects that can be sexual, or urinary, or having to do with the bowels. So there are different side effects that are associated with each of the different types of treatment. And IMRT, they also vary in cost and IMRT is one of the most expensive forms of treatment. And what we found is that physicians who self-refer patients for IMRT were 53 percent more likely to send their patients for this type of treatment than physicians who did not self-refer. The other interesting thing that we found was we looked at physicians who, in 2007, didn't self-refer their patients for anything. And then over the course of time, either their practice had purchased the equipment or they had joined a practice that had the equipment, and so by 2009, they had become self-referrers. And we called these providers switchers because they switched from not being self-referrers to self-referrers, and those providers, merely by the act of becoming self-referrers, changed their behavior. They increased their referrals for IMRT. They increased it by about 46 percent. [ Sarah Kaczmarek: ] And what does this suggest in terms of the role financial incentives played for self-referring providers? [ James Cosgrove: ] Well that's a really interesting question. I mean we tried to see are there differences that could explain it? So we looked at beneficiaries' ages. We looked at the location of the patients. We looked at their health status. We didn't see any differences. So putting that together with the fact of the large differences we saw between self-referrers and non self-referrers and especially among the group of providers who switched. You know we can only conclude that it looks very much like financial interests play a role in the type of treatment that a beneficiary with prostate cancer actually receives. [ Sarah Kaczmarek: ] What's GAO recommending be done to address these issues? [ James Cosgrove: ] Well two things. One is to increase transparency. We're recommending that Congress consider mandating that physicians who self-refer for IMRT disclose their financial interests to their patients. So that beneficiaries, when they're considering the advice that they get from their doctor about the kinds of treatment options that they have available, know up front that their physician may have a financial reason for suggesting one course of treatment versus another. The other thing that we're suggesting is that the agency that runs Medicare, the Centers for Medicare and Medicaid Services, make it easier to track these self-referrers. [ Sarah Kaczmarek: ] Finally for taxpayers concerned about the impact both for beneficiaries and for Medicare, what's the bottom line here? [ James Cosgrove: ] Well first and foremost, this is a health issue. This is about affecting individuals' lives. This is about a quality of life and so, patients really need to have objective and accurate information about the options that are available to them because they can affect not only the course of treatment but the side effects that accompany them. And second, there is a dollars and cents component to this too as well because IMRT is much more costly than some of the alternatives and to the extent that IMRT is being over utilized, that increases the cost not only to the program but to all beneficiaries as well. [ Background Music ] [ Narrator: ] To learn more, visit gao.gov and be sure to tune in to the next episode of GAO's Watchdog Report for more from the Congressional Watchdog, the U.S. Government Accountability Office.