Code bundling for CT of the abdomen, pelvis significantly reduces imaging reimbursements

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 - Reimbursement Cuts

Medicare code bundling of CT of the abdomen and pelvis results in a large reduction in reimbursements for imaging, according to a study published in the May issue of the American Journal of Roentgenology.

The Centers for Medicare and Medicaid (CMS) have reduced reimbursements for imaging in recent years. Lead author David C. Levin, MD, of the Thomas Jefferson University Hospital in Philadelphia, and colleagues explained of code bundling, one of the mechanism that lower reimbursements: “Code bundling can be defined as the combining of two or more existing Current Procedural Terminology version 4 (CPT-4) codes covering two or more physician services into a single code that covers all of those services. When bundling occurs, the old codes may either be discontinued or remain in existence (in case a provider performs the service separately or with another service not involved in the bundling).”

In 2011, the CMS bundled the codes for CT of the abdomen and pelvis though separate codes for each procedure continued to exist. The technical and professional relative value units (RVUs) were much less than the sum of the RVUs for the separate codes. This alteration could have a substantial impact on imaging reimbursements because of the frequency of which CT of the abdomen and pelvis are performed.

Levin and colleagues evaluated the effect of bundling the codes for CT of the abdomen and pelvis on overall Medicare reimbursements for imaging and its impact on radiologists. They did so by examining nationwide Medicare part B data files from 2001 to 2011 and selecting the codes for CT of the abdomen and pelvis before and after bundling occurred in 2011. The researchers ascertained procedure volumes and calculated utilization raters per 1,000 Medicare beneficiaries. They also determined aggregate Medicare reimbursements and the reimbursements given to radiologists by using the Medicare specialty codes.

Once the two codes were bundled in 2011, use of CT for abdomen and pelvis decreased  from 277.1 to 148.1  per 1,000. From 2001 to 2005, Medicare reimbursements for CT of these two areas steadily rose and remained stable through 2010. When 2011 rolled around, however, reimbursements decreased from $971.5 million from the previous year to $687 million. This decrease illustrates a drop of $284.5 million, or 29 percent, in one year. Reimbursements for the new codes were attributed to 88 percent of all payments for all CT exams of the abdomen and pelvis in 2011. Levin et al found that radiologists experienced $218.6 million, or 27 percent, of the decrease.

“Radiology has been hard hit by reimbursement reductions,” wrote the authors. “This is another example of a major cut, the magnitude of which may not have been fully anticipated. Although CMS will see this as helpful in their efforts to reduce health care costs, it could also lead to an adverse outcome—a loss of patient access to CT if payments continue to be reduced to the point at which providers can no longer cover their costs.”