Some imaging centers, drug makers may be driving up costs

The Dallas Morning News reports on the lure of the medical imaging business, which is many say is a "growth industry," including the idea that a "second- or third-hand MRI machine" can be purchased by a physician practice or free-standing imaging center for a few hundred thousand dollars but yield millions in new revenue. A report by America's Health Insurance Plans says as many as half the scans are unnecessary, and a McKinsey Global Institute study found the extra machines produce around $26.4 billion in additional costs each year. In addition, they expose patients to avoidable radiation (McNeill, 9/22).

Separately, drug maker Eli Lilly recently disclosed payments to 3,400 doctors around the country who promoted the company's products to other doctors in their communities, the Orlando Sentinel reports. The payments to the so-called "Lilly faculty" totaled more than $22 million in the first quarter of this year, and were disclosed as part of a settlement with the federal government. An Institute of Medicine panel said the speaking payments lead to increased drug sales and should be halted. A Harvard medical school professor and panelist said the speeches also drive up health costs by encouraging doctors to choose more expensive, brand-name drugs (LaMendola and Quintero, 9/23).

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This article was reprinted from khn.org with permission from the Henry J. Kaiser Family Foundation. Kaiser Health News, an editorially independent news service, is a program of the Kaiser Family Foundation, a nonpartisan health care policy research organization unaffiliated with Kaiser Permanente.