HAP Radiology Billing and Coding Blog

Avoid Medicare Payment Reductions by Upgrading CT Equipment

Posted: By HAP USA on May 7, 2015

Buried in the 2014 legislation that delayed the Sustainable Growth Rate for a year was a provision that will CT-scannerpenalize radiology groups that have not upgraded their CT equipment to the latest standards.  As described in the April 28, 2015 edition of Radiology Business,  “Beginning in January 2016, any exam acquired with a CT system that does not meet the XR-29- 2013 standard, also known as MITA Smart Dose, will be hit with a 5% penalty.  In 2017, that penalty jumps to 15%.  XR-29-2013 was published by the National Electrical Manufacturers Association’s Medical Imaging & Technology Alliance (MITA) in 2013, and is considered the industry standard for CT technology.”


Although it was covered in our March 6, 2015 article “Assessing the Future Impact of Medicare Regulations on Radiology and Radiation Oncology”, there has been little mention of this provision, perhaps because it has been overshadowed by other Medicare news.  But a 15% reduction in the technical component of a high-volume modality like CT is something that deserves the attention of any radiology group. Vendors will be issuing certificates of compliance by July, but it’s not too soon to ascertain the status of your equipment.  If an upgrade or replacement is necessary, a significant amount of lead-time will be required to meet the January 2016 deadline. 


An analysis of cost-benefit might be useful for the practice to understand what this reduction would mean in comparison to the cost of an equipment upgrade or replacement.   An approximation of the revenue reduction can be made by obtaining the practice’s technical component revenue from Medicare patients for CT procedures in 2014, and then multiplying it by 5% to arrive at the 2016 payment reduction.  For 2017, the penalty will jump to 15% and presumably will stay at that level for the years to come.  Avoidance of this revenue reduction will be a return on the investment required to bring the CT equipment into compliance.  Radiology Business indicates that CT standards will remain a focus of Medicare regulation, with penalties likely to be adjusted again around 2020 or 2021. 


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