Medical 'self-referral' practice raises conflict of interest questions

A north Phoenix radiation clinic owned by urologists who refer prostate-cancer patients there for an expensive type of radiation therapy collected more from Medicare in 2012 than any other similar provider in Arizona.

Located in a nondescript business center on 19th Avenue just north of Loop 101, the Arizona Prostate Cancer Center specializes in a type of treatment called IMRT, or ­intensity-modulated radiation therapy.

Doctors with Arizona Urology Specialists own the center and send patients there, a practice known as "self-referral" that raises questions about possible financial and medical conflicts of interest.

According to data released earlier this year, Arizona Prostate Cancer Center's radiation oncologist, Dr. Thomas Canty, collected $2.6 million under Medicare's Part B program in 2012, more than any of Arizona's 87 radiation oncologists that year. About $2 million was for IMRT and a related medical-imaging technology called IGRT, or image-guided radiation therapy.

Canty's Medicare revenue represented about 5 percent of the $54.5 million that the government health program for Americans age 65 and older paid to radiation oncologists in Arizona.

Medicare released the data to contribute to health-care transparency and accountability. The data did not cover payouts from private insurers or other government programs such as Medicaid, so total collections by Canty and the center likely are higher.

Doctors who use IMRT say the technology targets cancer with tumor-attacking beams while sparing surrounding healthy tissue. Critics say IMRT helps drive up health-care spending for a treatment that may not be any more effective than less-expensive therapies for lower-risk prostate cancer. They also say doctors may be referring patients to centers they partially or fully own to recover the cost of their investment.

A federal conflict-of-interest law named after former U.S. Rep. Pete Stark, D-Calif., prohibits doctors from profiting off medical services through referrals. However, the law allows doctors to offer "ancillary services" in their own office such as a chest X-ray or lab test. This exception allows certain medical specialists, such as urologists, to take an ownership stake in radiation centers where they refer patients.

In 2013, the U.S. Government Accountability Office found that more than half of the nearly $1.3 billion paid by Medicare for IMRT therapy went to radiation centers that treat prostate cancer. The federal report concluded that doctors who own IMRT centers were far more likely to send their patients to their treatment centers instead of recommending less-expensive therapies.

Canty did not return phone calls. Urologists with the north Phoenix center insist their ownership does not influence the type of treatment they recommend and that patients are free to pursue other options.

"When I counsel patients, I tell them there are a number of centers and they can go wherever they like," said Dr. Robert H. Shapiro, a urologist and one of the managers of Arizona Urology Specialists. "My counseling is absolutely no different than it was before I was part-owner" of the prostate-cancer center.

One former patient of Arizona Urology Specialists told The Arizona Republic his urologist first recommended that he go to the group's prostate-cancer center, even though it required a longer drive to get the daily treatment over nine weeks.

Critics believe that the sharp rise of IMRT is partly driven by business interests. Doctors typically invest about $2 million to acquire equipment needed for this type of center as well as hiring a radiation oncologist and staff.

One study published last year in the New England Journal of Medicine compared 35 urology groups that invested in a radiation center with 35 urology groups that had not. The study found that IMRT use among the self-referring groups more than doubled from 2005 to 2010, while the other doctors' referral to IMRT centers remained largely flat.

The Phoenix center was not included in the study.

Jean Mitchell, a Georgetown University health economist who completed the study, said the evidence shows that financial factors may influence the type of treatment that doctors recommend.

"Money drives practice patterns," Mitchell said. "The patients don't know what the best treatment is. It is not clear that they are being steered in the best direction."

Doctors who have lost a chunk of their radiation-oncology business to self-referring centers are highly critical of the arrangement. The American Society for Radiation Oncology, which funded Mitchell's study, has encouraged lawmakers to pass a conflict-of-interest law to prevent doctors from profiting from self-referral.

A bill sponsored by U.S. Rep Jackie Speier, D-Calif., would prohibit Medicare from paying for self-referrals involving radiation oncology, pathology services, advanced diagnostic imaging and physical therapy. The bill, introduced a year ago has stalled.

President Barack Obama's fiscal 2015 budget also proposes closing self-referral for radiation oncology, pathology, advanced imaging and physical therapy. The U.S. Department of Health and Human Services estimates the savings would be $6 billion over a decade if the proposal is enacted.

"Bipartisan groups have endorsed closing the self-referral loophole to improve care for patients and reduce Medicare spending," said Dave Adler, director of government relations for the American Society for Radiation Oncology. "Ultimately, Congress won't be able to ignore the overwhelming data demonstrating the problems of self-referral abuse."

Dr. Sameer Keole, a radiation oncologist with Mayo Clinic in Arizona, said that patients generally are inclined to follow their doctors' recommendations for a particular type of therapy at a center.

"Patients inherently trust their doctors," Keole said. "The problem is when you introduce financial incentives (that) have the potential to influence physician referral patterns and recommendations."

Know all options

Shapiro said a group of metro Phoenix urologists joined forces under a large physicians group called Arizona Urology Specialists, which describes itself as the state's largest urology group, and formed the Arizona Prostate Cancer Center.

Arizona Corporation Commission records show that the center formed in 2009 as a partnership between Arizona Urology Specialists and Columbus, Ohio-based AKSM/Oncology, which establishes similar physician-owned centers nationwide. The urology practices under the umbrella of Arizona Urology Specialists include Urology Associates Phoenix, Urology Associates Scottsdale, Scottsdale Center for Urology and Canyon State Urology in Glendale, Corporation Commission records show.

Shapiro said that his group hired Canty because it wanted a radiation oncologist who focuses exclusively on prostate cancer. The center also treats patients who are not sent there by Arizona Urology Specialists.

"Our hallmark is high quality," Shapiro said. "We have a radiation oncologist that we handpicked."

Shapiro said he does not exclusively recommend IMRT. He said other treatments — or monitoring the tumor's growth — may be appropriate based on a patient's condition or age.

"I make recommendations based on the parameters of disease and age," Shapiro said. "The number of referrals for radiation have not changed significantly at all."

Other common treatment options for prostate cancer include surgically removing the gland, inserting small radioactive seeds to kill the tumor, monitoring the tumor's growth without surgery, or hormone therapy. Other less-common treatments include stereotactic body radiation, which can be delivered in a handful of sessions.

Of the nearly one-quarter million American men who were diagnosed with prostate cancer in 2011, 90 percent of those tumors had not spread beyond the prostate, according to Mitchell's report.

Terry Roberts, a radiation oncologist at Banner MD Anderson Cancer Center in Gilbert, stresses that patients need to be informed of all options. A man in his 80s with a low-risk prostate cancer may be better served by actively monitoring the tumor, not treating it.

"We want to make sure patients are being informed of all their treatment choices," said Roberts. "A lot of times, treatment can be steered by a physician."

'Medicine is business'

The Arizona Institute of Urology, with five urology practices in the Tucson area, also refers patients to the radiation oncologist at its treatment center, the Cancer Therapy Center. The group's radiation oncologist, Shelli Hanks, was the top Medicare biller among 16 radiation oncologists in the Tucson area in 2012, collecting more than $1 million.

Dr. Ajay Bhatnagar, a radiation oncologist, said he took over treatment of a Casa Grande man who had been making long daily drives to Hanks' office on the recommendation of a urologist at the Arizona Institute of Urology.

The man, who had poor vision, made the lengthy drive to Hanks' Tucson office even though Bhatnagar's office was located hear his home. Once, the man was pulled over by a police officer who advised him he should not be driving so far.

The man mentioned the burden of the long daily drives to his dermatologist, who asked the man why he didn't go to Bhatnagar's office. The man told the dermatologist he was unaware that such treatment was available nearby.

Citing patient confidentiality, Bhatnagar said he could not identify the man. An Arizona Institute of Urology representative did not return calls.

Other metro Phoenix doctors who offer radiation oncology believe "self-referral" opens questions about whether urologists who own radiation centers are influenced by money.

"What it shows is that a lot of medicine is business," said Dr. Steven Schild, a radiation oncologist with Mayo Clinic. "You have to be cognizant of that when making health-care decisions.... You want an objective explanation where people have all the options and are not being pushed into one thing."

Two men, two experiences

When Phoenix resident Jim Shea was diagnosed with prostate cancer in 2011, his urologist gave him a choice — surgically remove the prostate or get radiation therapy at Arizona Prostate Cancer Center. The urologist wasn't on the staff of Arizona Urology Specialists.

"He recommended radiation but said if I wanted surgery, he would do it," said Shea, who was 74 at the time of his treatment.

Shea said the radiation therapy had few side effects. The bill was about $35,000, which was covered by Medicare and a secondary insurer.

When Phoenix resident Elliott Perritt felt he was being steered to a treatment facility, he asked for other options.

Perritt was diagnosed with prostate cancer in 2010 and underwent removal surgery. His urologist from Urology Associates Phoenix, which is part of Arizona Urology Specialists, recommended 45 sessions of a cutting-edge radiation treatment at Arizona Prostate Cancer Center.

Perritt, who lives near 44th Street and McDowell Road, said the prospect of making a long daily drive over nine weeks while undergoing radiation treatment seemed too daunting and asked to go someplace more convenient.

His urologist arranged treatment at Banner Good Samaritan Medical Center near 12th Street and McDowell Road, which is near Perritt's workplace.

"I knew I wanted to get all my treatments at Good Sam. I felt confident in their medical group," Perritt said.

Republic reporter Matthew Dempsey contributed to this article.

Average cost of prostate-cancer therapies

Hormone treatment: $2,112

Prostatecomy (surgical removal of prostate): $16,762

Brachytherapy (radioactive seeds implanted in prostate): $17,076

IMRT: $31,574

Source: New England Journal of Medicine