Medicare Spending For Diagnostic Radiology $890 Million Below Expected Levels for 2020

Data released by the American Medical Association on December 2, 2021, revealed that Medicare disbursements for diagnostic radiology services fell by $890 million (roughly 16%) below the projected levels in 2020.

Not only did diagnostic radiology services reimbursed by Medicare fall — revenue for all physician services in the Medicare system fell significantly — $13.9 billion total, about 14% below expected levels for 2020. This revenue drop of actual spending versus projections occurred across the board, regardless of medical specialty, region, service, or setting.

The American Medical Association data underscores the significant declines in revenue that all medical practices have suffered since the COVID-19 pandemic began. AMA President Gerald Harmon, MD, issued a statement confirming what health experts had suspected. People with Medicare as their insurance decided to omit healthcare screenings and put off medical procedures that they normally would have scheduled.

Dr. Harmon said, “Medical practices that have not buckled under financial strain continue to be stretched clinically, emotionally, and fiscally as the pandemic persists. Yet, physicians face many planned cuts to reduce Medicare physician payments by nearly 10% for 2022. As struggling physician practices face a difficult and precarious road to recovery, now is the time for financial stability in Medicare, and the AMA is strongly urging Congress to avert the planned payment cuts.”

Efforts continue, even though the American Medical Association facts did not sway Congress to address the Medicare reimbursement cuts that become effective January 1, 2022.

Radiology in 2020

Diagnostic radiology took one of the biggest hits in revenue decline in 2020.

• Medicare spending for diagnostic radiology was $890 million below expected levels — the third highest decline following physical therapy at $1.2 billion and ophthalmology at $1 billion.
• Interventional radiology was down about 4%, with revenues about $21 million lower than expected.
• Radiation oncology declined about 8%, experiencing $154 million less revenue from projected.

Some areas of healthcare saw a rebound beginning in mid-year. However, diagnostic radiology did not experience an “uptick” in revenue. The American College of Radiology reports that shutdowns of non-urgent care in the spring and summer of 2020 are largely responsible for the dramatic decline in revenue for diagnostic radiology. Cancer screenings plunged, and experts don’t yet know if the U.S. will see an increase in cancer deaths.

Where Do We Go from Here?

RBMA, the American College of Radiology, the Society of Interventional Radiology, and more than 300 other associations have been hard at work urging politicians to find a way to prevent the impending cuts to Medicare reimbursements.

On the evening of December 7, 2021, House Representatives passed Protecting Medicare & American Farmers from Sequester Cuts Act (222-212) to avert a crisis in the U.S. healthcare system, already stressed from almost two years of COVID-19 pandemic-related pressures. This bill provides much-needed relief for all healthcare providers who accept Medicare. The Senate will vote on this bill later in the week.

• Eliminates the 4% statutory cut for the PAYGO (pay-as-you-go) provision until 2023
• Includes a 3% increase in Medicare Physician Fee Schedule set to begin on January 1, 2022
• Delays the 2% Medicare sequester payment reduction for the first quarter of 2022 and provides a 1% transition period during the second quarter, 2022
• Postpones the radiation oncology payment model until 2023

RBMA expects this act to amount to about a 3% cut in Medicare reimbursements in 2022, compared to the almost 10.75% originally set to become effective on January 1, 2022.