Medicare Reimbursement For Breast Surgery Shows Steady Decline

ORLANDO, Fla.—Many specialties have experienced declining Medicare reimbursement rates and breast surgery is no exception, according to new research.

To investigate trends in Medicare reimbursement for breast surgery over the past 20 years, Terry Gao, MD, and her colleagues obtained reimbursement data for 2003 to 2023, from the Centers for Medicare & Medicaid Services (CMS) Physician Fee Schedule Look-Up Tool. They also obtained data on yearly inflation from the Bureau of Labor Statistics for the same period.

“We included 10 breast operations in our analysis. The code for sentinel lymph node biopsy first appeared in 2011, thus data collection for this code ran from 2011 to 2023,” said Dr. Gao, a surgical resident at Temple University in Philadelphia, who presented her research at the 2024 annual meeting of the American Society of Breast Surgeons.

Dr. Gao’s team multiplied procedure-specific relative value units (RVU) with the overall conversion factor to determine annual Medicare reimbursement for the 10 procedures and calculated yearly percentage changes in reimbursement for each operation. To evaluate the relationship between these changes and inflation, they compared the overall percentage change for the operations with the percentage change in the Consumer Price Index (CPI), and corrected data for inflation.

“From 2003 to 2023, the total unadjusted percent change for all operations was an increase of 22%. In the same period, the CPI increased by 69%, indicating that even before accounting for inflation, reimbursement for these operations did not keep pace with increases in the price for goods and services during this time,” Dr. Gao said.

After adjusting for inflation, the percentage change for all procedures fell by 21%. “This shows a substantial decrease in Medicare reimbursements when the impact of inflation is considered,” she said. Only two procedures—lumpectomy for malignancy and simple mastectomy—had an increase in Medicare reimbursement.

To get a picture of the financial impact these reimbursement changes have had on breast surgeons over the past decade, the researchers created a hypothetical scenario, first estimating case volumes for 2023 in the United States using the annual breast cancer case incident and assumptions about expected surgical volume. This resulted in a calculation of 297,790 cases with 90% undergoing surgery.

The team then multiplied current reimbursement rates for these procedures by estimated case volume. To calculate expected inflation-adjusted compensation, they obtained 2013 Medicare reimbursement rates and extrapolated them using the CPI to reflect inflation.

“The difference between the actual 2023 compensation and the hypothetical inflation-adjusted compensation represents the estimated financial impact of decreased reimbursements on breast surgeons,” Dr. Gao said.

In this hypothetical scenario, Dr. Gao and her colleagues estimated that U.S. breast surgeons were reimbursed $107,605,444 less for these operations in 2023 than they would have been if rates had kept pace with inflation since 2013.

While informative, Dr. Gao said the study’s focus on only Medicare reimbursement might obscure the broader impact from private insurers, which tend to follow Medicare’s lead. “We are also likely underestimating the true financial deficit of these reimbursement changes, as we excluded benign procedures and additional surgeries, such as reexcisions or completion axillary lymph node dissection, that may have been required depending on the final pathology,” she said.

Dr. Gao noted that other specialties have recorded declining Medicare reimbursements ranging from 18% to 30%—the latter for endocrine surgery. “So, we’re somewhere in the middle.”

She acknowledged that the findings could be interpreted in a positive light, reflecting improvements in efficiency or shifts toward value-based care. “Alternatively, reduced funding strains healthcare resources, potentially affecting quality of care and the financial viability of some facilities, particularly safety net hospitals serving the financially disadvantaged,” she said.

Dr. Gao added that although the downstream effects of declining Medicare reimbursements are uncertain, it is critical for stakeholders to remain vigilant. “Doing so allows surgeons to proactively address challenges and advocate for equitable policy to ensure sustained access to high-quality surgical care.”

Abhishek Chatterjee, MD, a professor of surgery and the chief of breast surgery and plastic surgery at Tufts Medical Center, in Boston, told General Surgery News he doubted that declining reimbursement rates will affect the quality of care that breast surgeons provide, but he was concerned that it will make it much harder to run a practice, particularly in suburban and rural settings.

“Where I worry is that when revenues are decreased, physicians will try to do more to keep their practices open and take on more than they can handle,” he said. “Physician burnout is already such a big problem in our society. Congress, CMS and other agencies should prioritize funding for breast cancer so that the front-line surgeons aren’t hurt in the process and the right thing is done. Cost cutting shouldn’t focus on breast cancer care.”