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Happy New Year – Imaging Reimbursements Take Another Hit

With the drop of the New Year’s ball – it’s the end of the road for both analog radiographic film based imaging and computed radiography (CR) systems which are memorialized in the U.S. Government’s 21st Century Cures Act and its rolling into the “Consolidated Appropriations Act of 2016” which was passed by Congress and signed into law by President Obama. This law set in motion a 20 percent Medicare reimbursement reduction for all analog film imaging in 2017, and sparks the phased-in beginning of a 7 percent Medicare imaging reimbursement reduction for all computed radiography (CR) imaged exams effective January 1, 2018 that will in turn escalate to a 10 percent reduction in 2022 and beyond.

With regards to the analog film imaging hit there are no big surprises with the enacted reimbursement reduction action. The overwhelmingly vast majority of analog film imaging disappeared years ago, when the advancing technology transition of computed radiography (CR) became the accepted industry standard. So, why does this “end of the road” and forced final sun-setting of the once breakthrough technology called computed radiography (CR) mean so much? Well, there are approximately 9,000 CR units installed and actively used today in the U.S. health care market. The capital dollars needed to transition technology in many hospitals and imaging centers continues to be constrained and challenged. Though many hospitals and imaging center providers have been preparing the last 36 months or so for this Medicare patient imaged billing reimbursement faucet to begin its trickle – many of these imaging business units just don’t have the dollars available to enact this forced technology transition and in turn have chosen to absorb the reimbursement hit until funds can be allocated.

The costs involved in migrating from CR, or even analog radiography, to direct radiography (DR) devices (either fixed or wireless) has an expensive price tag. There is no argument the leap in technologies from analog radiographic film-based to computed radiography (CR) and now to direct radiography (DR) is a proven progression towards superior imaging quality and the steadfast journey in reducing radiation dose to the patient. Current estimations published in several industry articles point to an anticipated DR panel installed base by 2021 reaching into the range of ~3.0M+ units with a market worth of $2.9 billion. This next technology transition trending tells us the clinical acceptance of DR is now the “gold standard” and the preferred technology.

The take-aways and questions for the readers of this article to ponder are simple; What is your 21st Centuries Act Strategy Plan in 2017? With 2018 less than 12 months away will your imaging business be financially impacted and incur this Medicare imaged reimbursement reduction? If so, how will it be off-set and what is your 2018 and beyond CR to DR technology transition plan? Bye-bye CR, you were a great technology tool that allowed us to leave the “darkroom” and see the new light of soft copy imaging!

Alan has been in the Clinical Engineering industry for 29+ years having served directly in the academic, governmental and community hospital settings. Alan’s career has spanned from imaging/ biomedical engineer to Director of Clinical Engineering. Alan currently serves today at the Vice President and Senior Advisor level with a leading medical equipment consultative and asset management firm.

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