As we reported a few weeks ago, a financial analyst issued a report that claimed Highmark CMS was planning to reduce the reimbursement rate for CardioNet's wireless cardiac monitoring service and the report ended up dominating the wireless health company's most quarterly investment call.
This week, CardioNet announced that Highmark CMS' reimbursement rate for CPT code 93229, Mobile Cardiovascular Telemetry Services, is $1,123.07 -- the same rate CardioNet announced last November.
UPDATE: While the announcement from CardioNet has reassured some analysts that the reimbursement rate won't drop by the rumored $200 -- at least in the near term, the press release states only that Highmark CMS has posted the rate, which does not preclude a rate cut in the future.
"Yesterday Cardionet announced that Highmark (the insurance carrier that currently sets Medicare pricing for [CardioNet]'s MCOT technology) posted its 2009 reimbursement rate for MCOT last week at $1,123, which represents no change from recent history," Merrill Lynch analysts wrote in a note today. "Because [CardioNet] has not yet talked directly to Highmark about this posting, the posting does not definitively mean Highmark will not cut reimbursement for MCOT or that CMS will not use a lower rate when it ultimately takes over pricing, but logic would strongly suggest that the probabilities of a near term rate cut are now very low."
When asked on what date did Highmark CMS post the reimbursement rate for MCOT technology, Highmark's Leland Perry said: "Any information you are looking for, you are welcome to look at our public website, but we're not going to comment on anything related to CardioNet."
The .pdf file that lists all of Highmark's CPT rates for Pennsylvania is listed as being last updated on April 7, 2009, which is well before any talk of a cut for reimbursement rates began. The document lists CPT code 93229, Mobile Cardiovascular Telemetry Services, at $1,123.07. Here's the link.
Reimbursement rates are crucial for wireless health companies playing in the clinical space -- they directly affect a company's bottom line because they set the price points that the Centers for Medicare and Medicaid Services are willing to pay clinicians for prescribing the products.
During CardioNet's investor call, SVP and Chief Finanical Officer Marty Galvan noted that the company has always assumed some reduction in reimbursement when predicting its earnings through 2011, but Galvan made a caveat: "Candidly the argument is just as strong that we could justify a higher level of reimbursement as there would be any reduction."
Later in the call CEO Randy Thurman assured investors and analysts that the company does not "anticipate any change on reimbursement whatsoever."
CardioNet quashes reimbursement rate rumors