Medicare Reimbursement Decreased from 2000 to 2020 in Head and Neck Surgical Oncology

For the 37 most common head and neck surgical oncologic procedure codes considered as a group, U.S. Centers for Medicare & Medicaid Services (CMS) reimbursement decreased from 2000 through 2020, according to a recent analysis (Head Neck. 2022. doi:10.1002/hed.27064). Only 4 of the 37 codes evaluated showed an increase in net reimbursement during the study period.

The general decrease in CMS reimbursement for the 37 surgical oncologic procedure codes occurred despite a 23.2% increase in gross reimbursement for all head and neck procedures during the same period. However, adjusted for inflation, this increase translated into a 19.4% decrease in physician reimbursement. 

To asses reimbursement trends for specific surgical procedures for head and neck cancer, the researchers began by identifying the most commonly billed Current Procedural Terminology (CPT) codes within the head and neck surgical oncology practice at University Hospitals Cleveland Medical Center in Cleveland, OH. Reimbursement data for these codes was then accessed from CMS by using the Physician Fee Schedule Look-Up Tool and collected the facility reimbursement value for each code.

However, in 2007, CME implemented a National Payment Amount as the reimbursement ate for a given code. Therefore, for all codes from 2000 to 2006, the rates for all CMS localities were averaged to obtain a proxy for the National Payment Amount.

For each procedure, the researchers calculated and averaged the unadjusted total and annual percentage change in reimbursement. In addition, the reimbursement rate for each code was adjusted to 2020 dollars by using changes in the Consumer Price Index to account for inflation during the study period. The adjusted data were then used to analyze reimbursement trends for the most commonly billed head and neck oncologic surgery procedures.

Using these methods, the researchers evaluated changes in reimbursement by procedure to assess variability in reimbursement between types of procedures. As a result, they found that nearly all procedure types had a decrease in reimbursement when adjusted for inflation. 

The researchers noted the greatest average decrease in reimbursement, 47%, for excision of the submandibular gland, and the greatest average increase in reimbursement, 14%, for glossectomy and hemiglossectomy.

As reimbursement decreased, the number of Relative Value Units (RVUs) assigned per procedure steadily increased over time. Therefore, because payment for physician services depends on the conversion of RVUs to dollars by use of a conversion factor, their analysis revealed that although procedures were being valued at higher RVUs over time, they were simultaneously receiving less reimbursement.

“In addition, our findings suggest that the net negative effects on facility reimbursement are consistent annually with an approximate 1.1% decrease per year,” wrote Humzah Quereshy, MD, MBA., Department of Otolaryngology – Head and Neck Surgery, University Hospitals Cleveland Medical Center, Cleveland, OH, and team. 

“Further research is necessary to explore the implications of these trends on the delivery of patient care,” they concluded.