HAP Radiology Billing and Coding Blog

Hidden Reductions in the Medicare 2015 Physician Fee Schedule

Posted: By HAP USA on January 02, 2015

According to the American College of Radiology (ACR), “The technical component for more than 200 imaging procedures will be cut by up to 55 percent in the final 2015 Medicare Physician Fee Schedule hidden_reductions_mpfs_2015(MPFS) because of a decision to remove the direct practice expense of numerous film inputs that affected their reimbursement rates in favor of the cost of acquiring a desktop computer.”  The decreased reimbursement is sizable for such procedures as myelography, CTA and a variety of ultrasound studies.  The ACR’s analysis was released in their recent eNews article Analog to Digital Conversion to Cost Radiologists.  The article includes helpful impact tables showing the specific change in radiology reimbursement rates between 2014 and 2015 for each CPT code. 


The changes cited by the ACR are the result of Medicare’s attempt to recognize that most practices today use digital PACS technology rather than film.  They removed the costs associated with film production and storage, but replaced those costs with only the value of $2,501 to represent a typical radiology reading station.  No recognition was given to the overall cost of installing and maintaining the central PACS hardware and software.  The ACR reports that, as an example, CPT 76377 (3D Post-processing of tomographic modality) receives a 45.7% reduction for film-based costs offset by a gain of only 1.7% when the desktop computer is substituted.


While the ACR and other stakeholders will continue to work with the Relative Value Scale Update Committee (RUC) for future correction of procedure valuation, the fee schedule as published will take effect for 2015.  Radiology practices can best evaluate the potential impact of these changes, along with all of the other Medicare fee schedule changes, by performing a volume-weighted analysis utilizing a radiology-focused coding services partner.  This type of analysis uses a practice’s actual volume by CPT code, applies it to the new fee schedule, and then compares it with the old fee schedule to provide a personalized assessment of the changes and their impact on practice revenue.  Office or imaging center volume should be viewed separately from hospital professional component services, since most of the fee schedule changes affect the technical component much more than the professional component.


An estimate of 2015 volume by CPT code can be obtained by using 2014 year-to-date information, or any other recent period that is representative of the practice’s usual patterns.  Again, consider utilizing a radiology-focused coding or management services partner to perform this critical assessment if staff time and expertise is limited.


Related articles:

How the MPFS Rule for 2015 will Impact Radiology Practices

Topics: radiology reimbursement, radiology coding, medicare reimbursement, MPFS

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