Nisenbaum HL, Birnbaum BA, Myers MM, Grossman RI, Gefter WB, Langlotz CP. The costs of CT procedures in an academic radiology department determined by an activity-based costing (ABC) method.
J Comput Assist Tomogr 2000;
24:813-23. [PMID:
11045708 DOI:
10.1097/00004728-200009000-00026]
[Citation(s) in RCA: 39] [Impact Index Per Article: 1.6] [Reference Citation Analysis] [Abstract] [MESH Headings] [Track Full Text] [Journal Information] [Subscribe] [Scholar Register] [Indexed: 12/22/2022]
Abstract
PURPOSE
The purpose of this work was to determine the costs of computed tomography (CT) procedures in a large academic radiology department, including both professional (PC) and technical (TC) components, by analyzing actual resource consumption using an activity-based costing (ABC) method and comparing them with Medicare payments.
METHOD
Over a 12 month period from July 1, 1996, to June 30, 1997, 1,011 CT procedures, representing 16 Physicians' Current Procedural Terminology (CPT) codes and 98.3% of CT studies performed, were carefully observed by a research assistant trained in ABC methodology. Information collected during these time and motion studies included personnel/machine time and direct materials used. Actual resource units used during the different activities in each CT procedure were valued using appropriate cost drivers. Unit values for both direct and overhead costs were calculated: the cost of an individual procedure equaled the sum of component costs. Costs were compared with PC and TC payments according to the 1997 Medicare Fee Schedule.
RESULTS
Total costs of CPT codes 70450 (CT Head unenhanced), 71260 (CT Chest enhanced), and 74160 (CT Abdomen enhanced), which represented 71.2% of CT studies performed, were $189.19, $273.53, and $343.20, respectively. For all 16 nonmodified CPT codes analyzed, Medicare's professional reimbursement was less than the professional cost, whereas its technical reimbursement exceeded respective cost in 14 of the 16 codes.
CONCLUSION
In the setting and time period studied, Medicare underreimbursed professional costs while overreimbursing technical costs.
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