Medicare to cut analogue X-Ray payments from 2017 – will this impact mobile X-Ray devices?

Mar 29,2017

In order to gradually push U.S. healthcare providers towards adopting digital radiography, the Medicare system will start reducing payments for analogue x-ray systems from this year onwards. From 2018, computed radiography equipment sites can also expect some kind of payment reductions. For providers of analogue x-ray study claims, the reduction in Medicare payments will be 20% as per a provision in the Consolidated Appropriations Act of 2016 that took effect as a law in December 2015. From 2018, imaging studies on CR equipment payments will be decreased by 7% for five years and then 10% post that. While the law’s provisions concerning analogue x-ray systems are anticipated to have a minimal impact on conventional systems still used in the United States, CR payment reductions could have a much bigger impact. All the systems that need to be substituted or image facilities will face the situation of payment reduction.

The Consolidated Appropriations Act provisions are written to hasten the switch of U.S. healthcare providers towards DR by bringing about a change in the Hospital Outpatient Prospective Payment System. Considered a ‘special rule’, it states a 20% cut from this year to the technical aspect of reimbursement for x-rays taken via film. The CR cuts are meant to be completed in phases that start next year. The complete act is available on the U.S Congress site. The DR provision was initially put into the 21st Century Cures Act, a legislation devised in 2015 that would have replaced the Multiple Procedure Payment Reduction. MPPR was quite contentious and was implemented in 2012 by the U.S. Centers for Medicare and Medicaid Services. It cut reimbursement by a substantial 25% for imaging studies conducted on the same body part of the same patient in the same imaging session. The 21st Century Cures Act was able to pass through the House of Representatives, but a lot of its provisions were included in the Consolidated Appropriations Act in the U.S Senat e. This included both the D.R provision and a reduction in MPPR from 25% to 5%. The budget bill was eventually signed by former President Barrack Obama with both provisions intact. Estimates say that the two provisions can help the federal government save almost $350 million over the next decade. With respect to the DR provision, lower Medicare payments made to hospitals using CR equipment or analogue systems will contribute to the savings.

Will this legislation affect hospitals in the U.S.? Not those using analogue x-rays as these film-based systems have fallen to negligible levels in the country. In fact, the installed base in the U.S is close to essentially nothing. CR paints a different picture though. While widely considered to be digital technology, it lacks the workflow efficiency of digital radiography and that is why sales have been consistently declining. From more than half of digital x-ray sales ten years ago, CR sales have fallen to a low single digit percentage now. In spite of this decline, the strong CR installations in the past ensures that they account for a significant chunk of the install base of digital x-ray systems, as opposed to analogue x-ray systems.

Imaging facilities will need to take a call on whether to upgrade their existing CR equipment to DR, or accept an almost 10% reduction in x-ray study payments. A good portion of these facilities are in less-developed areas and they lack the capital required to invest in expensive new equipment. Switching to DR will bring about efficiency and workflow gains along with lowering radiation dosage received. Analogue systems are widely considered to be outdated and unhelpful now. CR is certainly less so, much more widely used and has many supporters. However, even CR is making the inevitable shift towards digital technology and the Act passed simply builds the momentum. Digital imaging should make it feasible to reduce the cost per procedure by enabling a higher throughput in imaging centres. The requirement to buy, develop and store film is all but eliminated. This is particularly advantageous when the high cost of medicine compels other costs to be kept in check. 

       

View Our Reports

View Reports