Physician Groups Warn Congress on Medicare Pay
Physician groups are warning Congress that stagnant Medicare reimbursement, which remains flat despite rising costs, threatens patient access to care. The latest 2.5% pay increase is considered insufficient, creating downstream pressure on the profitability of imaging centers and the compensation for radiologists.
- The 2024 Medicare Physician Fee Schedule finalized a 3.4% reduction in the conversion factor, the multiplier used to calculate reimbursement, dropping it from $33.89 in 2023 to $32.74. This continues a trend that has seen Medicare payments for radiologists decline by about 20% over the last decade. - This site-of-care shift is driven by payers encouraging the use of more cost-effective outpatient settings and by health systems looking to capture this growing market. Outpatient imaging volume is projected to grow substantially, with advanced modalities like PET, ultrasound, and CT expected to increase by 23%, 16%, and 15% respectively over the next ten years. - In response to these trends, many hospitals are pursuing "systemness" strategies by acquiring or partnering with freestanding imaging centers to create integrated networks. This allows them to maintain professional coverage standards and expand service opportunities, though it often involves buying out previous physician or entrepreneur partners. - The pressure on reimbursement is happening alongside a significant radiologist shortage, which is expected to worsen. Contributing factors include an aging workforce, burnout, and an increasing demand for complex imaging studies. This shortage leads to longer wait times for patients and increased operational costs for imaging providers. - To combat staffing shortages and improve efficiency, providers are turning to teleradiology and artificial intelligence. Teleradiology provides access to a wider pool of radiologists, while AI tools can help automate tasks like workflow prioritization and initial image analysis. - The FDA is rapidly approving AI-enabled medical devices, with radiology being the primary specialty. As of mid-2024, 76% of all approved AI medical devices were for radiology, with major manufacturers like Siemens, GE, and Philips leading the way. - While hundreds of AI tools for radiology have been cleared by the FDA, a recent study found that only 29% had undergone clinical testing, and just 5% underwent prospective testing before authorization. Most approvals (97%) use the 510(k) pathway, which requires demonstrating "substantial equivalence" to an existing device rather than new clinical trials.
