CMS Physician Fee Schedule Delays Capping Radiation Oncology Reimbursements

Tony Berberabe, MPH @OncBiz_Wiz
Published: Thursday, Dec 12, 2013

Richard Schilsky

Richard L. Schilsky, MD

Some radiation oncologists may breathe a little easier for now because the Centers for Medicare & Medicaid Services (CMS) has decided not to cap certain freestanding radiation oncology reimbursements in its Physician Fee Schedule Final Rule, which was issued November 27.

Both the American Society for Radiation Oncology and the Radiation Therapy Alliance (RTA) issued statements commending CMS, which spared freestanding centers from significant cuts. In July, CMS was proposing a 5% cut in reimbursement, but the final rule only calls for a 1% cut in radiation oncology reimbursements. That doesn’t mean freestanding centers are in the clear, however. How much Medicare will pay, in addition to policies that affect the practice expense component (ie, equipment, non-physician labor, and supplies), will likely affect how much freestanding centers will be paid in 2014.

Medicare reimbursement is also on the minds of medical oncologists. Richard L. Schilsky, MD, the chief medical officer of the American Society of Clinical Oncology (ASCO) says the organization is happy that “CMS is not enforcing the cap without a full understanding of its impact on patient access.” He is most concerned, however, with the changes to the Medicare Economic Index (MEI). MEI is a measure of practice cost inflation that was developed in 1975 as a way to estimate annual changes in physicians’ operating costs and earnings levels. He says “changes in the MEI for 2014 could result in an almost 6% cut in reimbursement, and that’s in addition to the sequester cuts.”

According to a statement from the RTA, payments to freestanding centers have declined by 18% over the past decade. The statement continued, “Freestanding radiation therapy centers have experienced disproportionate cuts compared to hospital-based radiation therapy, which has experienced a net increase in reimbursement during the same period.”

Payment for the most common radiation therapy modalities delivered in hospitals will increase by 6%, according to Lindsay Conway of the Advisory Board Company. “CMS will increase payments for three-dimensional conformal radiotherapy (3D CRT), intensity-modulated radiation therapy (IMRT), and image-guided radiation therapy (IGRT),” Conway states in her “Oncology Rounds” column.

The RTA proposes an episode-based, bundled payment system for freestanding centers, which could include data collection to improve treatment protocols and would also ensure payment stability. “A bundled payment model will generate savings for taxpayers, increase predictability for providers, and produce better clinical outcomes for patients over time,” said RTA in a release.


The Advisory Board Company. Services. Oncology Rounds. http://www.advisory.com. Accessed December 11, 2013.


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