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Tuesday, December 18, 2007

What Medicare cuts could mean

It looks like Congress will not intervene and that Medicare cuts of 10.1% on average are imminent. Urology is slated for an 11% cut. What does this mean in real dollars. Let's take a look.


 

Practice A sees 1200 patients per month = 14,400 visits per year x 25% Medicare = 3600 Medicare visits per year x average visit value of $150 = $540,000 reimbursed per year from Medicare x 11% = [$59,400 - $540,000] = $480,000 lost income if Medicare is dropped completely.

Practice A sees 1200 patients per month = 14,400 visits per year x 10% Medicare = 1440 Medicare visits per year x average visit value of $150 = $216,000 reimbursed per year from Medicare x 11% = [$23,700 - $216,760] = $193,000 lost income if Medicare is dropped completely.


 

Practice B sees 400 patients per month = 4800 visits per year x 25% Medicare = 1200 Medicare visits per year x average visit value of $150 = $180,000 reimbursed from Medicare x 11% = [$19,800 - $180,000] = $160,200 lost income if Medicare is dropped completely.

Practice B sees 400 patients per month = 4800 visits per year x 10% Medicare = 480 Medicare visits per year x average visit value of $150 = $72,000 reimbursed from Medicare x 11% = [$7,920 - $72,000] = $64,080 lost income if Medicare is dropped completely.


 

Practice C sees 200 patients per month = 2400 visits per year x 10% = 240 Medicare visits per year x average visit value of $150 = $36,000 x 11% = [$3,960 – $36,000] = $32,040 lost income if Medicare is dropped completely.


 

So as you can see, the numbers are large indeed whether a group or solo urologist keeps or drops Medicare. However, based on my calculations, a urologist or urology group would still do better remaining par with Medicare. Out and out dropping of Medicare would be tantamount to suicide for the business.

Though it is tough for me as a urologist to admit, Medicare has me by the balls.

Good luck to everyone else.