Medicare Redistribution is a Step in the Right Direction

Elyas Bakhtiari, for HealthLeaders Media , July 9, 2009

Although most physicians are in favor of increasing primary care reimbursement as long as it doesn't come from specialists' piece of the pie, that mutually beneficial outcome doesn't seem possible in an environment where costs are such a major concern. So this rebalancing of reimbursement is the best option and a necessary step in the right direction.

Most of the specialties hit hardest by this—cardiology, radiology, nuclear medicine, radiation oncology—already make over $400,000 at the median levels of MGMA's compensation surveys (for a full list of specialty reimbursement changes, see p. 716 of the fee schedule proposal). Primary care is still under $200,000, so this change will by no means close the payment gap.

I don't mean to dismiss the concerns of a cardiologist or radiologist looking at a potential 11% drop in reimbursement. I may not be making friends here, but I am trying to look at it from the perspective of what's best for the larger health system, and this change addresses two of its more significant problems—the lack of primary care physicians and the overutilization of imaging services.

And it's not that specialists' work is suddenly no longer valued. Most of the reimbursement for actual clinical work remains unchanged; it's just the subsidy for equipment expenses that took a hit. And you could argue they were being overpaid in the first place.

CMS' methodology could have been better and it would be nice to have some empirical evidence to show that CMS isn't now overestimating equipment utilization. But as the agency says in the proposed rule, it's hard to believe so many physicians would be making capital investments in expensive equipment that they only use 50% of the time.

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Elyas Bakhtiari is a freelance editor for HealthLeaders Media.

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