Published 6/1/2017
Jordan Vivian; Cindy Bracy

New Cuts to X-Ray Reimbursements

Beginning in 2018, orthopaedic practices will face a reduction in reimbursement for the use of computed radiography (CR) as an incentive to upgrade to digital radiography (DR). AAOS is opposed to these reductions, which could punish providers for using a digital technology that is often clinically advantageous to their patients.

The provision was included in the Consolidated Appropriations Act of 2016, a massive "omnibus" government funding bill that was considered "must-pass," and for which no amendments were allowed. Lawmakers inserted the provision to save an estimated $350 million over 10 years.

Practice impact
The law affects Medicare and Medicaid reimbursement on the technical component (TC) for radiographs performed with older technology. Orthopaedic practices will see a 20 percent reimbursement reduction on claims submitted for radiographs performed on analog equipment in 2017. Reimbursement for CR would be reduced by 7 percent between 2018 and 2022, followed by a 10 percent reduction in 2023 and beyond (See Table 1).

The direct cost to member practices to upgrade hardware and software to DR will have a significant impact on smaller orthopaedic practices. According to a 2016 survey conducted by the AAOS and the American Association of Orthopaedic Executives (AAOE), 78 percent of practices use CR to diagnose musculoskeletal abnormalities. Cost to transition equipment from CR to DR can vary, but ranges from $80,000 to $100,000 per machine. This does not include the potential cost to expand practice facilities due to the upgrade.

It is estimated that providers who choose not to upgrade may forfeit an average of $19,287 per year beginning in 2018. In 2023, these practices will then lose an average of $27,568 per year for the life of this policy. That would mean that practices would lose an estimated $5.2 million annually, for an estimated total of $18 million by 2023.

The problem with this "incentive"
Both CR and DR are digital methods of radiography. The difference between the two systems lie in the processes used to capture and extract the image for review in electronic format. Both methods allow for storage in a picture archiving and communication system (PACS) and transfer among physicians utilizing an electronic health record (EHR).

According to a 2016 survey of AAOS members, of the practices that use CR to diagnose musculoskeletal abnormalities, 85% indicated that CR was their preferred method because it is easy to use, easily portable, and has the ability to capture long-form images, such as the spine. Respondents also indicated that while DR uses a lower dose of radiation, there is a need for repeat imaging whereas images taken using CR can be easily manipulated without repeat studies.

One surgeon respondent said, "We have been keeping track of the number of missed fractures and avascular necrosis that has been missed on outside DR and the number is higher than we expected…. Also we do not find that the computerized templating tools for joint size are as accurate as the CR because the size of the x-ray can be manipulated and the computer templating tools are ANOTHER additional cost to purchase."

Many concerns involve postimaging issues for spinal images. CR can produce one long view of the entire spine, whereas DR requires the use of expensive, sophisticated software to "stitch" together separate images. This means that CR will continue to have a place in many of the practices providing radiography services until the stitching software needed to correctly piece together multiple scans becomes less expensive or DR gains "long-view" functionality.

AAOS efforts to overturn these cuts
The AAOS Office of Government Relations, jointly with the AAOE, the National Association of Spine Specialists (NASS), and other organizations are working with allies in Congress to delay or eliminate these unnecessary cuts. In January 2017, AAOS and AAOE wrote a letter to the Chairman and Ranking Democrat of the House Energy and Commerce Committee arguing that the reimbursement reductions would ultimately harm patients and reduce access to care. The letter, coauthored by then-AAOS President Gerald R. Williams Jr, MD, argued that Congress used this provision as an easy "pay-for" without fully considering the high rate of usage of CR equipment, the diagnostic advantages of CR and the disadvantages of DR, and the effect on patients, especially those in rural areas. Dr. Williams asserted that Congress must at the very least "allow practices more time to make the necessary adjustments to their business plans and financial commitments in order to undertake the significant investment DR requires."

What you can do to help
Reach out to your member of Congress and ask him or her to delay these harmful cuts. If Congress intends to incentivize physicians to switch to the newer technology, it should legislate financial incentives to encourage the transition, not apply punitive measures to those who fail to upgrade to a newer but arguably not clinically advantageous radiologic process.

AAOS staff is happy to be a resource to anyone who would like to reach out to their member of Congress on this issue. Please contact Jordan Vivian at vivian@aaos.org or 202-548-4153 with any questions.

Jordan Vivian is manager, AAOS Office of Government Relations. Cindy Bracy is manager, practice management affairs, in the AAOS Office of Government Relations.