Budget Neutrality and Medicare Physician Fee Schedule Reimbursement Trends for Radiologists, 2005 to 2021

Purpose: The Medicare program, by law, must remain budget neutral. Increases in volume or relative value units (RVUs) for individual services necessitate declines in either the conversion factor or assigned RVUs for other services for budget neutrality. This study aimed to assess the contribution of budget neutrality on reimbursement trends per Medicare fee-for-service beneficiary for services provided by radiologists.Methods: The study used aggregated 100% of Medicare Part B claims from 2005 to 2021. We computed the percentage change in reimbursement per beneficiary, actual and inflation adjusted, to radiologists. These trends were then adjusted by separately holding constant RVUs per beneficiary and the conversion factor to demonstrate the impact of budget neutrality.Results: Unadjusted reimbursement to radiologists per beneficiary increased 4.2% between 2005 and 2021, but when adjusted for inflation, it declined 24.9%. Over this period, the conversion factor declined 7.9%. Without this decline, the reimbursement per beneficiary would have been 9 percentage points higher in 2021 compared with actual. RVUs per beneficiary performed by radiologists increased 13.1%. Keeping RVUs per beneficiary at 2005 levels, reimbursement per beneficiary would have been 12.1 percentage points lower than observed in 2021.Conclusions: Given budget neutrality, a substantial decline has occurred in inflation-adjusted reimbursement to radiologists per Medicare beneficiary. Decreases due to both inflation and the decline in conversion factor are only partially offset by increased RVUs per beneficiary, meaning more services per patient with less overall pay, an equation likely to heighten access challenges for Medicare beneficiaries and shortages of radiologists.