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Proposed Medicare and Medicaid fees for cancer treatments could cut revenues for Fort Myers-based Radiation Therapy Services by 20 percent and could threaten the access to care for patients in rural areas, executives said.
The proposed rules, published earlier this month by the Centers for Medicare and Medicaid Services, would cut revenues by $44 million, said Bryan Carey, chief financial officer for Radiation Therapy.
“Essentially, in an unprecedented approach, the CMS cited concerns in the media about alleged overutilization, largely in the area of prostate cancer, as the primary driver for the potential cuts,” Carey said this past week in a conference call with industry analysts.
Published stories in national media were cited in communications with the CMS, Carey said. Included in the cuts were calculations of “machine time,” cutting treatment times from 60 minutes to 30 minutes.
Those cuts don’t consider the time preparing treatment equipment between patients, Carey said.
Radiation Therapy Services Inc. operates 126 treatment centers, including 95 in 15 states. The company also operates 30 centers in six Latin American countries and one in India.
The fees are what Medicare and Medicaid will pay to reimburse free-standing cancer treatment centers for qualified patients who receive intensity modulated radiation therapy or stereotactic body radiation therapy.
About 55 percent of Radiation Therapy’s revenue comes from federal reimbursement or sources that base their fee on the federal guidelines, Carey said.
The CMS is accepting comment on the proposed rules until Sept. 4 and they would take effect in 2013.
Daniel Dosoretz, M.D., president and CEO of Radiation Therapy Services, said the fee cuts are an overreach to correct some perceived overuse of some therapies.
“This is a hammer-type approach to this,” Dosoretz said. “If this goes on, it is going to create a huge access problem.”
Dosoretz said the loss of income for centers in rural areas may force them to close.
Albert Blumberg, M.D., chairman of the American College of Radiology Radiation Oncology Commission, said he also believes closures are “absolutely going to happen” unless the fee proposal is changed.
“Those more rural facilities that aren’t filled to capacity, they are no longer going to be able to stay open,” Blumberg said. “And, as a patient, if you aren’t well enough to take a long ride to the treatment center, you might decide to forgo treatment. The magnitude of these cuts is pretty draconian.”
Dosoretz said Radiation Therapy Services and other cancer treatment providers will be working through the Centers for Medicare and Medicaid Service administrative process to adjust the fee schedules and, failing that, will reach out to legislators.
Blumberg said the CMS has backed off on rule changes before and he hopes the same thing will happen the proposed fee changes.
“Hopefully, we will be able to elicit change again,” Blumberg said. “I hope the CMS will be responsive to the fact that as a society, we are trying to provide care for people.”