Orthopedics billing services

Medicare Reimbursement for Orthopedic Surgery

The Centers for Medicare & Medicaid Services (CMS) sets reimbursement rates for Medicare providers and generally pays them according to approved guidelines such as the CMS Physician Fee Schedule. Medicare reimbursement for orthopedic surgery follows the same set of rules; however, recently the amount of Medicare reimbursement for orthopedic trauma surgery has fallen by nearly one-third over the past two decades, according to a recent study.

The current pandemic impacted adversely for example- State and federal COVID-19 relief packages offered throughout the year could lead to additional cuts down the line, leaving smaller practices already operating on fine margins in particular distress.

While many surgeons believe that reimbursement cuts were inevitable, one of the biggest concerns is that the scope and magnitude of the cuts will limit access to care when patients need it most.

It is threatening to observe that physician payment for surgical services is looming. Various policies from CMS in the FY 2021 Medicare Physician Fee Schedule (MPFS) propose to cut all orthopedic surgical services by 5%.

These policies have the potential to destabilize an already challenged healthcare system and drastically diminish the opportunity for physician practices to recover financially from the public health emergency.

Let’s understand four keys CMS updates for spine surgeons in 2021:

  • About 300 musculoskeletal procedure codes will be removed from CMS’s inpatient-only list over three years, including 67 spine codes for 2021.
  • Beginning July 1, 2021, CMS will require prior authorization for cervical fusion with disc removal as well as implanted spinal neurostimulators.
  • Under the Medicare Physician Fee Schedule, CMS finalized a conversion factor of $32.41, which is a decrease of $3.68 compared to the conversion factor for 2020.
  • While CMS’ 2021 final rules spelled more bad news for surgeons, some spine device companies will benefit from the agency’s transitional pass-through payment program, which provides additional payments for new devices that show a substantial clinical improvement over existing technology.

While finding out the reimbursement trends for the 20 most billed surgical procedure codes in orthopedic trauma from 2000 to 2020 researchers found that the majority of traumatic bone fractures require surgical repair with some type of hardware (internal fixation). Moreover, these trends are varied by procedure types. Let’s understand them in detail

Orthopedic Surgery reimbursement trends

“Relative Value Units” (RVUs) for individual procedures is used to find out Medicare reimbursements’ s is nothing but an arbitrary multiplier that is supposed to reflect the value of the physician’s work, practice expenses, and malpractice coverage.

It is observed that average total RVUs increased 4.4 percent for the 20 procedures from 2000 to 2020 and most of the increase was in malpractice RVUs, with a small decrease in practice expense RVUs.

The trends varied by procedure type where foot and ankle procedures decreased in mean adjusted reimbursement by 42.6%. Hip fracture procedures decreased by 31.9%. Lower extremity long bone procedures decreased by 30.9%. Shoulder and upper extremity procedures decreased by 23.7%.

Changing face of US healthcare system

The US healthcare system is very dynamic in terms of policies and payment structures throughout the last several decades, including Medicare. With the aging of the population, there will be increased demand on the Medicare system to fund orthopedic trauma surgery and fracture care in old people.

Finally, to assure continued access to high-quality surgical orthopedic care in the US; hospitals, Orthopedic surgeons, and policymakers should understand the rising healthcare awareness among the people and changing reimbursement trends. If you are not comfortable with changes and looking for outsourcing partners for Medicare Reimbursement for Orthopedic Surgery, then you can get in touch with us.

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