Proposed Medicare Physician Fees' Winners and Losers

Some of the biggest cuts are aimed at independent testing laboratories, which see 26% of their fees slashed, followed by radiation therapy centers, which may lose 13% under CMS's "particularly complicated," proposed changes.

The proposed rule governing next year's physician fee schedules released last week by the Centers for Medicare & Medicaid Services clearly show the winners and losers in primary care and specialty physician paychecks starting Jan. 1.

Anesthesiologists, emergency room physicians, cardiologists, cardiac surgeons, critical care specialists, geriatricians, infectious disease specialists, and thoracic surgeons seem to be the winners, with upgrades in code payments that average 2% or 3%.

Family practitioners, gastroenterologists, general surgeons, internists, nephrologists, neurosurgeons, nuclear medicine specialists, and pulmonary disease specialists all would get a 1% average increase, depending on which codes they most frequently bill.

But doctors who work with radiation therapy and cancer appear to be getting cuts. And some of them, depending on the codes they traditionally bill and the settings in which they work, in a hospital outpatient department or in a private practice office, will be getting large cuts.

Some of the biggest cuts are aimed at independent testing laboratories, which because of proposed new way of calculating clinical laboratory fee stand to see 26% slashed, followed by radiation therapy centers, which may lose 13%, largely because of the way CMS proposes to calculate the relative value unit portion of that pay.

For individual practices, specialists in pathology and radiation oncology would absorb the biggest average cuts of 5%, while interventional radiologists would get cut 4%; allergy and immunology practitioners, rheumatologists would receive 3% less. 

Dermatologists, hematologists/oncologists, interventional pain management practitioners, neurologists, otolaryngologists, radiologists, urologists, and vascular surgeons would receive an average 1% to 2% cut in pay.

For some specialty organizations, these changes will not sit well, and specialty societies are already parsing the rules to find ways they can fight back.

This particular set of proposed changes is "particularly complicated," with some parts of it having a potentially "Draconian impact," said Michael Steinberg, MD, chairman of the board of directors of ASTRO, the American Society for Radiation Oncology. "We did not expect some of the things" that are being proposed.

"We're still analyzing this, but it appears that some of the codes have been cut by as much as 40%, for example, 77301 for IMRT, (intensity modulated radiation therapy) planning. We believe there's a substantial impact there."

See Also: 60% of Docs Wouldn't Recommend Their Profession as a Career

ASTRO plans to survey its members as it understands the proposed rules better, especially the impact these new payment policies could have on "small rural centers – and whether it will create access problems" for Medicare beneficiaries when fewer of such facilities are around or offer fewer services.

Geraldine McGinty, MD, chairwoman of the American College of Radiology's economics commission, says that the proposed cuts come after "a cascading series of cuts" in recent years. "And there are a lot of implications; practices are struggling to survive, these are small businesses that provide care, and jobs, and physicians say that with these cuts it's more difficult to buy more equipment, and that has a (negative) impact on innovation.

"We're looking for fair treatment from Medicare, and some of the cuts that have come recently, such as those for (certain) procedures, really seem quite illogical."

In a statement, ACR said that CMS' other proposed rule, affecting the Hospital Outpatient Prospective Payment System, would "establish separate cost centers for CT and MRI, distinctly separate from the diagnostic radiology cost center in the inpatient setting. And that "would not only cut hospital outpatient payments for CT and MRI studies by 18% to 38%, but the technical payments would fall below the rates in the Physician Fee Schedule causing these cuts to affect in-office imaging as mandated by the Deficit Reduction Act."

Peter Hollmann, MD, speaking for the American Geriatric Society, said some parts of the proposed rules are "harmful to geriatricians on their overall practice" even though the fee schedule shows that geriatricians are overall winners, with an average payment increase of 2%.

Hollmann emphasized, however, that he does not consider the changes any reflection that the federal government is valuing the work of geriatricians more, only that it has reconsidered the value of other services, such as imaging, and downgraded those.

"We're the innocent bystander, who instead of getting collateral damage, is getting a collateral reward." Hollmann added that the overall policy shift reflects CMS' effort to "look at all services, and more appropriately value them than they have in the past."

A key change in the way Medicare beneficiaries imaging services will be paid has to do with an adjustment in equipment utilization, which goes from an assumption the machines are being used 50% of the time to being used 90% of the time. That will tend to dramatically reduce payment for imaging services.

Lee Hilborne, MD, past president of the American Society for Clinical Pathology, whose independent labs are being cut 26%, and whose 15,000 pathologists will receive on average 5% less, says the organization will likely fight the cuts.

"We first need to understand the rules, and make sure that the value of pathology and lab services are adequately addressed," Hilborne says, adding that laboratory services provide answers in test results that make up 75% of the information that drives clinical decision making in diagnosis.

"If we get to the point where laboratories cannot provide the service, that's not really going to be in the interest of quality," he says. "If you're told you're going to be paid less, the gut reaction is that the system doesn't value us as much as it did before, but in fairness, it's important that we understand how this all came about."

The schedule includes these increases and decreases for numerous allied health professionals:

Audiologist +1%
Chiropractor +2%
Clinical psychologist +3%
Clinical Social worker +3%
Nurse anesthetist and anesthetist assistant +4%
Nurse practitioner +1%
Optometry – no change
Oral/maxillofacial surgery (2%)
Physical/occupational therapy + 1%
Physician assistant +1%
Podiatry – No change
Portable x-ray supplier (1%)