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Are We Working Harder for Less Pay? A Survey of Medicare Reimbursement for Hand and Upper Extremity Surgery
Suresh K Nayar1, Adi Wollstein1, Brian T Sullivan1
1From the Johns Hopkins Hospital; and Massachusetts General Hospital.
Background:
Ongoing concern for declining Medicare payment to surgeons may incentivize surgeons to perform more cases to maintain productivity goals. The authors evaluated trends in physician payment, patient charges, and reimbursement ratios for the most common hand and upper extremity surgical procedures.
Methods:
The authors examined Medicare surgeon payment, patient charges, and surgical volume from 2012 to 2017 for 83 common surgical procedures, incorporating the year-to-year Consumer Price Index to adjust for inflation. The reimbursement ratio was calculated by dividing payment by charge. Weighted (by surgery type and volume) averages were calculated.
Results:
Total Medicare surgeon payment increased 5.6 percent to $272 million for the studied procedures. Patient charges were seven times greater than payment, growing 24 percent to $1.9 billion. Despite growth of total payment, the average overall weighted payment for a single surgery decreased 3.5 percent. The average weighted patient charge increased 8 percent, whereas the reimbursement ratio decreased 13 percent. A hand surgeon would need to perform three more cases per 100 in 2017 to maintain the same reimbursement received in 2012. After categorizing these 83 surgical procedures, distal radius fixation (>3 parts, 21 percent increase; >2-part intra-articular, extra-articular, and percutaneous pinning, 17 percent increase), bony trauma proximal to the distal radius (10 percent increase), and upper extremity flap (5 percent increase) were subject to the greatest increases in payment. Payment for forearm fasciotomy (39 percent decrease), endoscopic carpal tunnel release (30 percent decrease), and mass excisions proximal to the wrist (18 percent decrease) decreased the most.
Conclusions:
From 2012 to 2017, despite a disproportionate increase in procedure charges, Medicare surgeon payment has not decreased substantially; however, total reimbursement is multifactorial and involves multiple sources of revenue and cost.
Insights
Surgeon Medicare payments for hand and upper extremity procedures saw a slight increase, but reimbursement ratios declined. Surgeons needed to perform more cases to maintain income due to rising patient charges.
Area of Science:
- Orthopedic Surgery
- Health Economics
- Surgical Outcomes
Background:
- Surgeon payment concerns may drive increased case volume to meet productivity.
- This study evaluates trends in Medicare physician payment, patient charges, and reimbursement for common hand and upper extremity procedures.
Purpose of the Study:
- To analyze trends in Medicare surgeon payment, patient charges, and reimbursement ratios for common hand and upper extremity surgical procedures between 2012 and 2017.
Main Methods:
- Examined Medicare surgeon payment, patient charges, and surgical volume for 83 procedures from 2012-2017.
- Adjusted for inflation using the Consumer Price Index.
- Calculated reimbursement ratio (payment/charge) and weighted averages.
Main Results:
- Total Medicare surgeon payment increased 5.6% to $272 million, while patient charges grew 24% to $1.9 billion.
- The average payment per surgery decreased 3.5%, and the reimbursement ratio dropped 13%.
- Surgeons needed to perform 3% more cases per 100 to maintain 2012 reimbursement levels in 2017.
Conclusions:
- Medicare surgeon payment for these procedures did not substantially decrease from 2012-2017, despite rising patient charges.
- Total reimbursement is influenced by multiple revenue streams and costs.
- Physician reimbursement trends necessitate careful consideration of practice economics.
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