To deal with that problem, HCFA created a separate practice expense pool for those services and used average clinical staff time, as determined from the CPEP data, to allocate the pool to specific codes. HCFA separated radiation oncology from radiology and used each specialty's practice expenses per hour. Since the practice expenses per hour for radiation oncology were higher than for the combination, this change benefited radiation oncology. HCFA estimates that the net effect of the changes will be a 2 percent increase for hematology-oncology in 1999 and a 6 percent increase by 2002 when the changes are fully phased in. For radiation oncology, HCFA estimates a 2 percent decrease in 1999 and an ultimate 6 percent decrease, which is significantly better than the 13 percent reduction that would have resulted from the proposal.
Medical oncology does relatively well compared to other specialties.
Both medical oncology and radiation oncology also showed some of the most significant improvements compared to the June 1998 proposed rule. In a prior year, HCFA had maintained budget neutrality by reducing the relative values, and this change undoes that action by making the conversion factor the vehicle for budget neutrality adjustments. Because of the decrease in the conversion factor and the related increase in all the relative values, it is difficult to identify the changes due to the revision of the practice expense components by looking only at the relative values. Therefore, Table 2 compares the 1998 fee schedule amounts to the 1999 amounts for various illustrative services. HCFA defended its use of the top down methodology, stating that it complied better with the requirements of the Balanced Budget Act than the bottom up methodology.