Financial impact of the Medicare Fee Schedule on a department of anesthesiology in an academic medical center: two scenarios.
The purpose of this study was to model the financial impact of the Medicare Fee Schedule (MFS) on an anesthesiology department in a large academic medical center under two different scenarios. Scenario 1 assumes continued use of actual-time units throughout the five-year transition period. Scenario 2 assumes a change to the use of average-time units by the time the MFS is fully implemented in 1996. Twelve months of actual payments and frequencies for services billed to Medicare in 1991 were used as baseline data. It was assumed there would be no change in volume of services, billing practices, or staffing patterns. It was estimated that upon full implementation of the MFS, the anesthesiology department that was studied would lose $244,000 (13%) under Scenario 1 and $945,000 (51%) under Scenario 2. There is a full transition to final fee schedule rates in Year 1 of the MFS transition under Scenario 1, whereas there are additional incremental losses in each successive year under Scenario 2. This study shows that HCFA's future policy decisions with regard to anesthesiology reimbursement will have substantial financial consequences for many practicing anesthesiologists.
Department of IM, University of Michigan Medical School, Ann Arbor.
J E
JE
Billi
C G
CG
Wise
S C
SC
Middleton
S J
SJ
Loney
K K
KK
Tremper
D000046:Academic Medical Centers / Q000191:economics*; D000761:Anesthesia Department, Hospital / Q000191:economics*; D003365:Costs and Cost Analysis; D005245:Fee Schedules; D006278:Medicare / Q000191:economics*; D017059:Models, Econometric; D014481:United States