ReCAP: Radiation Oncology Practice: Adjusting to a New Reimbursement Model [Business of Oncology]

QUESTION ASKED:

How will the increasing use of hypofractionation (use of a fewer number of fractions) affect reimbursement and staffing in a hospital-based radiation oncology department?

SUMMARY ANSWER:

From a 40% use rate of hypofractionation, a department could anticipate an annual reduction in technical revenue of $540,661 and a reduction in workflow of approximately five patients or 1 to 1.5 operating hours per day.

METHODS:

We modeled the effects on reimbursement on a typical average-sized hospital-based radiation oncology department of moving to hypofractionation for the most common cancers that make up the bulk of a typical hospital-based practice using 2015 Centers for Medicare and Medicaid Services reimbursement rates and relative value unit values.

RESULTS:

A radiotherapy department treating 40% with hypofractionation would experience an approximate $540,663 decrease in global revenue with a per-case marginal reduction of $9,498, $4,297, $9,040, and $1,777 for lung, breast, and prostate cancers and palliative care, respectively. The reduction in relative value units would be 2,121 with a per-case marginal reduction of 20.88 for lung and prostate cancers, 10.44 for breast cancer, and 5.22 for palliative care treatment.

BIAS, COUNFOUNDING FACTOR(S), DRAWBACKS:

We modeled basing our assumptions on a Medicare fee schedule and hospital-based practice, so the marginal reduction in revenue could be greater for commercial insurances and in the setting of free-standing practices. We assumed hypofractionation for breast, prostate, and lung cancer and palliative cases only, because clinical effectiveness data in other cancers are inconclusive. We also assumed no use of intensity-modulated radiation therapy or brachytherapy for breast cancer, and no use of stereotactic radiation for prostate or lung cancer or palliative treatment, because these technologies do not have conclusive data and/or widespread use in clinical practice.

REAL-LIFE IMPLICATIONS:

The move to hypofractionation in the United States is justified where evidence exists and offers great benefits to patients and the field of radiation oncology in general. At the same time it will lead to increased pressures on departments to address budget shortfalls resulting from the decrease in per-patient revenue. This will affect departments' ability to update or replace equipment and may encourage consolidation or centralization of departments. There may be reduced radiation technologist needs because of reduction in workflow hours per day and challenges in funding nonreimbursed but important clinical support staff. For the physician, these hypofractionated treatment programs require greater skill, time, and effort for each fraction delivered, which also requires changes in residency training (Table 1).

Table 1.

Reduction in Hospital-Based Technical Billing Through Adoption of Evidence-Based Hypofractionation in Radiation Oncology Clinic

Hypofractionation (%)Change in Technical Revenue ($)Lung Cancer (n = 21)Breast Cancer (n = 100)Prostate Cancer (n = 75)Palliation (n = 25)1019,945.5542,969.9967,807443.272039,891.0985,939.99135,6148,886.543059,836.64128,909.99203,42113,329.804079,782.18171,879.99271,22817,773.075099,727.73214,849.99339,03522,216.3360119,673.27257,819.99406,84226,659.6070139,618.82300,789.98474,64931,102.8680159,564.36343,759.98542,45635,546.1390179,509.91386,729.98610,26339,989.40100199,455.95429,699.98678,07044,432.86Per-case marginal reduction9,4984,2979,0411,777

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