Judge DeLawrence Beard. Source: Washington College of Law

Physicians are appealing to the Maryland Court of Special Appeals regarding a trial court ruling that prohibits doctors from referring patients to diagnostic entities in which they have a financial stake, except in certain circumstances. The ruling has had Maryland physicians dueling for the last year over the scope of the state's self-referral law regarding in-office imaging tests and services.

Despite some of the exceptions, the Montgomery County Circuit Court said the 1993 statute strictly bans non-radiologists from referring patients within their practices for CT, MRI and radiation therapy services, according to the American Medical Association News (AMA News).

Last December, 14 medical practices challenged the board saying that state authorities misread the law and several exemptions within it that allow in-office referrals for ancillary services, including imaging tests, reported AMA News.

The trial court disagreed, focusing on a seeming conflict between several provisions in the law, and Judge DeLawrence Beard recognized three exemptions when doctors are permitted to self-refer, which are:

• The doctor is referring for in-office ancillary services that meet certain supervision, location and billing requirements;
• Services or tests are provided within the same group practice as the referring doctor; and
• Services or tests are directly supervised by the referring doctor.

The court noted, however, that the statute's definition of ancillary services "specifically excludes MRI and CT scans for all doctors except radiologists" — a delineation that "forecloses the two other exceptions." The court also determined that allowing doctors to self-refer for the services under the group practice and direct supervision exceptions would make lawmakers' proscription void.

AMA News reported that some doctors, however, feel the ruling could diminish patient care.

“The law was meant to be a balancing act between protecting against overuse and ensuring that patients get good medical care,” said Howard R. Rubin, the physicians’ attorney, who added that the decision renders the statutory exceptions meaningless.

“The court read the carve-out of MRI and CT in just one particular provision as an overreaching prohibition in the statute, and this interpretation takes out of the hands of numerous specialties the services that are common practice in the standard of care,” Rubin said.

Plaintiffs and other physicians also said the decision constitutes a blanket ban on in-office imaging by non-radiologists, when state and federal policy deem it proper under certain conditions, reported AMA News.

According to Maryland Asst. Attorney General Thomas W. Keech, the medical board's counsel, referral relationships lead to abuse, and lawmakers specifically intended to curb that. Otherwise, “the legislature would have an entire chapter of the law that had virtually no meaning.” He said the ruling does nothing to stop medical practices from investing in diagnostic services. "It just stops [doctors] from referring their own patients to it."