April 2000 Bulletin

Reimbursement trend: E/M up surgery down

Although surgical procedures continue to account for the majority of Medicare reimbursements to orthopaedic surgeons, more than one-half of the services provided to Medicare patients by orthopaedists in 1998 were for evaluation and management (E/M).

In 1992, E/M and consultation services accounted for 53 percent of the Medicare allowed frequency (number of services billed) and 17 percent of allowed charges (payments received). By 1998, the latest year for which data is available, those numbers had increased to almost 56 percent of services billed and 24 percent of reimbursement.

In 1992, surgery and assistant-surgery services accounted for almost 18 percent of frequency and 74 percent of Medicare payments. By 1998, the frequency had dropped only one-half percent, but Medicare payments for surgical services declined to 66 percent of the total.

These figures reflect the decrease in reimbursement for many surgical procedures since the introduction of the Medicare resource-based relative value scale payment system in 1992. The data also indicate a small increase in payments for diagnostic radiology, even as relative frequency has shown a slight decline.

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