suggest everyong read TD's recent research report maybe i am missing something, but even if CMS amends the anesthesia code/reimbursement rate this won't impact CRH's cash generating abilities much at all according to TD's recent research report:
CRH’s Limited Exposure to the CMS Reimbursement Rate — Exhibit 1
illustrates that a 5% reduction in Medicare reimbursement rates would only result in
~1% reduction in Adjusted EBITDA. In our most negative scenario — a 15% rate
cut, the result is ~4% reduction in forecast Adjusted EBITDA. Notably, Exhibit 3
illustrates that recent changes (in CMS reimbursement rates) have been in the +/-
4% range.
i was under the impression that the private insurers followed CMS' guidance, but TD says they use very different reimbursement rationale (implying that a drop in coverage by CMS would not affect the way private/commercial payors reimburse).
Our sensitivity analysis suggests that recent market perception regarding CRH’s exposure to CMS-related reimbursement risk may be overblown. Key considerations, in our view, are: (i) Medicare’s relatively small contribution to CRH’s procedural volumes and (ii) low likelihood of major reimbursement rate-cuts in the near term. With respect to the much more important commercial payers, these firms utilize a very different reimbursement rationale from Medicare. The end-result is that commercial payers routinely reimburse at higher prices than Medicare for most clinical procedures (Exhibit 2).