Radiation Oncology Practice: Adjusting to a New Reimbursement Model

Use of hypofractionation is increasing in radiation oncology because of several factors. The effects of increasing hypofractionation use on departments and staff currently based on fee-for-service models are not well studied.

We modeled the effects of moving to hypofractionation for prostate, breast, and lung cancer and palliative treatments in a typical-sized hospital-based radiation oncology department. Year 2015 relative value unit (RVU) data were used to determine changes in reimbursement. The change in number of fractions was used to model the effects on machine volume, staff time, and workforce predictions.

The per-case marginal reduction in technical revenue was $1,777, $4,297, $9,041, and $9,498 for palliative and breast, prostate, and lung cancer cases, respectively. The physician reduction per case in RVUs was 5.22, 10.44, 43.02, and 43.02 respectively. A department could anticipate an annual reduction in technical revenue of $540,661 and a reduction in workflow of approximately five patients or 1 to 1.5 hours per day from a hypofractionation rate of 40%.

The move to hypofractionation in the United States will lead to increased pressures on departments to address budget shortfalls resulting from the decrease in per-patient revenue. This may be done through a combination of an increase in patient volume, recognition of the increased skill sets required to deliver hypofractionated radiotherapy, delay in capital purchases, and/or reduction in staff. In a value-based environment, these evolutions should improve the value proposition of radiation oncology over a fee-for-service model.