Despite Increased Need for Services, Medicare Reimbursement Is Decreasing

Medicare reimbursement for ophthalmology services has decreased by more than 20% over the last decade, according to data reported at the American Academy of Ophthalmology 2020 Virtual meeting.

According to Amanda Lu, MD, of UCLA Stein Eye Institute, declining reimbursements in Medicare have placed pressure on physicians to cut costs and see more patients. With this study, Dr. Lu and colleagues wanted to analyze trends in Medicare ophthalmology reimbursement for common billing codes during the last decade to see the effects of these cuts.

Dr. Lu and colleagues selected 45 common ophthalmology CPT codes from published practice management and billing guidance. They used the Medicare Physician Fee Schedule Lookup Tool to obtain Medicare reimbursement non-facility fees from 2010 to 2020. The fees were adjusted to reflect 2020 dollars and annual change in reimbursement and compound annual growth rate were computed.

Over the 10-year study period, the rate of reimbursement decreased by 20.8%. Annually, the rate of reimbursement decreased 2.3%, and the compound annual growth rate decreased by 1.2%. The highest decrease in reimbursement occurred from 2014 to 2015, with a 4.6% decrease.

Looking at specific fees, office visits had the smallest annual decline at 0.3%, and diagnostic testing had the greatest at 3.5%.

Additionally, claims from the Medicare Fee for Service Improper Payments Data were extracted for 2011-2019. Of all 45 codes, about 5% of claims were improper claims. The highest annual improper claim rate was 6.5% in 2015. There was no correlation between improper claims rate and annual changes in reimbursement. Insufficient documentation was the most common reason for improper claim.

“While reimbursement cuts have placed additional pressure on practice management and overhead, the annual mandate leaves further cuts to ophthalmology as a continuing challenge,” Dr. Lu said.