Health Economics for the Otolaryngologist

There is growing evidence throughout medicine, including otolaryngology, that reimbursements have consistently been falling over the last 2 decades, which no obvious end in sight. Herein, we aim to educate otolaryngologists on the macro and microeconomic forces acting on health economics, detail the trends in reimbursements, and discuss how these trends affect providers and patients.

A narrative review of changes in reimbursements and practice patterns within otolaryngology was performed.

Otolaryngology procedures have experienced as much as a multifactorial 50% decrease in inflation-adjusted Medicare reimbursement since 2000. On a macroeconomic level, the decline has been driven by the 1997 Balanced Budget Act, which threatened a decrease in conversion factor (the rate per relative value unit [RVU] physicians are paid) year-after-year (often blunted by congressional acts). On a microeconomic level, many otolaryngologic procedures have been targets for bundling and decreased RVUs, most notably rhinologic procedures in 2018. Decreasing reimbursements may be contributing to increasing procedural volume, increasing demand for ancillary sources of practice income (eg, in-office CT scans), and increasing private equity/large hospital practice buyout. These may expose patients to decreased quality of care.

Otolaryngologic payments have been in continued decline for 2 decades, with potential important consequences for providers and patients. Awareness of the issues surrounding this key trend are vital.