Dear Imaging Center Insider,
Been Down So Long It Looks Like Up to Me, a novel by Richard Farina (and, later, a song by the Doors), aptly sums up the mood of U.S. radiology business managers and administrators this year. Declining reimbursements coupled with an increasing demand for services are beginning to strain the economic fabric of many practices as they try to do more with less.
Outpatient imaging facilities have been particularly hard hit as they struggle to cope with technical component reimbursement cuts mandated in the Deficit Reduction Act (DRA) of 2005. Groups that base their business model on providing only professional interpretations have taken a hit this year as that component has also seen reductions across several product lines.
As grim as the past few months have been, radiology is looking at a new set of challenges that will affect the specialty across the board, according to Dr. Howard Forman, associate editor of health policy for the American Roentgen Ray Society (ARRS).
According to Forman, improvements to payments for evaluation and management (E&M) services recently enacted by the U.S. Centers for Medicare and Medicaid Services (CMS) do not bode well for radiology. Because Medicare requires budget neutrality by statute, an improvement in one area results in a budget reduction in another.
More importantly, the adjustment involved the relative value units (RVUs) assigned to each encounter. This means that Medicare has readjusted the relative number of dollars that flow to E&M codes as compared with procedures. Because many practices negotiate contracts with payors on the basis of RVUs, they may well find that they will receive lower reimbursements.
To learn more about the coming changes set to impact professional reimbursement, click here. As an AuntMinnie.com Imaging Center Insider, you have access to the article days before the rest of our members.
In other news, be sure to check in over the next few weeks as we take a look at the effect of the DRA on practices in the first quarter of 2007. In addition, we'll be onsite at the Radiology Business Management Association (RBMA) Radiology Summit in St. Louis and the American Roentgen Ray Society scientific conference in Orlando, FL, to provide breaking news coverage.
Finally, if you have a comment or report to share about any aspect of imaging practice, management, administration, regulation, or financing, please contact me at [email protected]. I look forward to hearing from you.
