Physician Reimbursement Dropped Sharply

Laura Joszt

In a continued effort to reduce health care costs in the U.S., payers drastically reduced the reimbursements physicians received for existing patient visits by up to a third.

In a continued effort to reduce health care costs in the U.S., payers drastically reduced the reimbursements physicians received for existing patient visits, according to a study by UBM Medica/Physician’s Practice.

Since 2001, pay rates to physicians have declined or remained flat for almost every year; however, the cuts in 2012 were particularly steep as a third of payers cut pay for services and began to experiment with value-based pay models. The trend will likely continue, too.

According to 80% of respondents, all of their revenue came from contracts that were fee-for-service in 2012. However, only 76% expect that will remain true for 2013.

For the lowest-complexity diagnostic code for an existing patient, the average reimbursement dropped by a third to $20 from $30 the year before.

Regional pay matters a lot. For example, a code that reimburses $22.60 in New England (99211) reimburses $25.60 in the Pacific region but only $11.40 in the Mountain region of the U.S.

Although pay for existing patients dropped, there was a modest increase in pay for most new patient visits. The least-complex new patient code (99201) increased by 12% to $57.20, but the reimbursement for the highest-complexity code for new patients (99205) declined slightly.

"Even the modest pay bumps are probably temporary," Bob Keaveney , Physicians Practice's editorial director, said in a statement. "I think 2013 is going to be another difficult year for physicians, as payers continue to try to control health costs by holding down reimbursement."