Inflation-adjusted Medicare pay in radiology has decreased by $2.8B since 2005

Medicare reimbursement to radiologists has plummeted nearly 31.9% or $2.8 billion since 2005, after adjusting for inflation, according to a new analysis published Thursday in JACR.

Budget neutrality requirements under the federal payment program mean that spending increases in one place necessitate cuts elsewhere. This has resulted in the annual exercise of “robbing Peter to pay Paul,” as one industry watcher put it, with diagnostic radiology facing a proposed 4% reimbursement cut in 2024.

Imaging researchers set out to measure how such actions have impacted the specialty over the long term, using 100% of aggregated Medicare Part B claims spanning 2005 to 2021. Reimbursements to radiologists on a per-beneficiary basis increased 4.2% during the timespan (from $182 to $189). However, when factoring for inflation, Medicare pay actually dropped 24.9% (from an adjusted per-beneficiary figure of $252 in 2005).

This occurred during a period when radiologists took on an increasing workload, with relative value units leaping 13.1% during the 16-year study period.

“In conclusion, there has been a substantial decline in inflation-adjusted reimbursement to radiologists per Medicare fee-for-service beneficiary over the 2005 to 2021 period, despite the fact that each beneficiary is consuming more radiology services, as measured by RVUs,” lead author Eric W. Christensen, PhD, with the Harvey L. Neiman Health Policy Institute, and colleagues wrote Aug. 31. “This reimbursement decline is associated with the budget neutrality requirement that has caused reimbursement changes to not keep up with inflation. Declining Medicare reimbursement may further exacerbate access challenges for Medicare beneficiaries with access to radiologic care compared with patients with commercial insurance as well as shortages of radiologists.”

Meanwhile, the conversion factor—the dollar amount used to convert RVUs into payment—fell 7.9% (from $37.8975 to $34.8931) or 33.6% when adjusted for inflation. Christensen and colleagues estimated that, if RVUs per beneficiary remained at 2005 levels, real radiology reimbursement would have dropped 34% per beneficiary.

Total reimbursement to radiologists under the Medicare Physician Fee Schedule declined 5.5%, from $6.2 billion in 2005 down to $5.8 billion in 2016. Adjusting the 2005 total for inflation, radiologists earned $8.6 billion, or 48.3% more, 16 years ago than in 2021.

Medicare continues these cuts beyond the study period, with the conversion factor further declining to $34.6062 in 2022 and $33.8872 in 2023. Accounting for inflation, the figure has now fallen 43.1% from 2005 to 2023, the authors noted.

“In addition to detrimental impact on access, substantial reimbursement declines contribute to radiologist burnout,” the study noted. “Radiology practices, whether private, corporate, or academic, can preserve financial sustainability by working faster, taking fewer breaks, or lengthening the workday … Working harder for less reimbursement undoubtedly increases the risk of burnout among radiologists.”

Read more from the Journal of the American College of Radiology at the link below, and find study summary from the Neiman Health Policy Institute here.

Marty Stempniak

Marty Stempniak has covered healthcare since 2012, with his byline appearing in the American Hospital Association's member magazine, Modern Healthcare and McKnight's. Prior to that, he wrote about village government and local business for his hometown newspaper in Oak Park, Illinois. He won a Peter Lisagor and Gold EXCEL awards in 2017 for his coverage of the opioid epidemic. 

Around the web

After reviewing years of data from its clinic, one institution discovered that issues with implant data integrity frequently put patients at risk. 

Prior to the final proposal’s release, the American College of Radiology reached out to CMS to offer its recommendations on payment rates for five out of the six the new codes.

“Before these CPT codes there was no real acknowledgment of the additional burden borne by the providers who accepted these patients."

Trimed Popup
Trimed Popup