Radiation Oncology’s Fee Schedule Problem Is Becoming an Access Problem

By Ron DiGiaimo, MBA, FACHE Chairman, R3source Health: RCCS | Regents Health Resources | RC Billing

Radiation oncology is running into a reimbursement problem that too many people still want to file under “administrative.” It isn’t.

The current fee-schedule gaps shape how and IF centers can operate, which patients they can schedule, and how long practices in smaller markets can keep their doors open. Left alone, this becomes an access problem — and in parts of the country, it already is becoming one at alarming speed.

Reimbursement rates that don’t cover the treatment

California is the cleanest example of mis-value. Medi-Cal pays $0 dollars for CPT 77387, unbelievable. The core treatment-delivery codes — 77402, 77407, and 77412 — are reimbursed at levels that have no meaningful relationship to what modern radiation therapy actually costs to deliver forcing the provider to deliver care at a material loss. Anyone inside the specialty knows what those numbers lead to. You cannot sustain advanced linacs, physics coverage, QA programs, and clinical staffing on rates that don’t cover the treatment they’re nominally paying for. It isn’t cost containment; it’s a quiet withdrawal of access by attrition.

And California isn’t alone. On January 1, 2026, radiation oncology went through its most significant coding overhaul in more than a decade. Treatment delivery was consolidated into 77402, 77407, and 77412; image guidance was consolidated into 77387; and the underlying definitions shifted in ways that required payers to rebuild fee schedules, update billing systems, rewrite policy language, and retest claims processing. That was always going to be heavy lifting on the payer side.

It’s a payer-readiness story

In many places, the lifting hasn’t happened. Numerous Medicaid programs across the country still haven’t updated their billing systems or fee schedules to match the new code set, and providers are reporting payment problems tied directly to the revised treatment-delivery codes. This isn’t just a California story or a Medicaid story. It’s a payer-readiness story playing out nationally, and it’s putting practices in the position of delivering 2026 cancer care on economics set years ago while the expense side of the equation is current.

Fee schedules aren’t passive documents

Fee schedules drive decisions about whether a service line stays viable, whether a center keeps investing in technology and people, whether capacity stays open, and whether patients can get treatment close to home. In radiation oncology specifically — where capital requirements are enormous and there is effectively no margin for operational slack — bad reimbursement doesn’t sit quietly in the background. It moves through the system fast.

Physician survey points to the problems

The pressure is already showing up. Recent national physician survey data points to widespread double-digit reimbursement declines, staffing strain, and rising concern about closures. Public reporting on the 2026 transition has flagged cuts of up to 30% in some practices, with community-based and rural centers taking the hardest hit. Access rarely disappears all at once. It gets harder to schedule, then options narrow, and eventually patients are driving hours for treatment that used to be down the road which are most often higher costs to the Medicaid system and payers in general. This has a compounded negative effect on high attention to Radiation Oncology and overall reimbursement.

Call to action

States need to update their fee schedules now, built around the 2026 code set and the real cost of delivering radiation therapy. California should move first and should not have been in this position in the first place; other states should audit their own schedules before the disruption spreads. Medicaid agencies should not find reasons to delay correction as our firm has been told by Medi-Cal reps, claiming it could be as late as 2027 before a correction is put into place!!!!!!! Stale reimbursement has operational consequences whether the agency is ready for them or not.

Commercial payers face the same obligation. Updating policy language without fixing fee logic doesn’t solve anything, and industry guidance issued this year explicitly directs providers to renegotiate or reprice the new treatment-delivery codes where commercial rates haven’t caught up.

Radiation oncology is raising this flag now. California providers and stakeholders can start by reading my call-to-action letter on Medi-Cal reimbursement, which lays out the specifics and the timeline. If you’re seeing the same pressure in your state — or you want to compare notes on what this is doing to operations and access in your market — reach out. Problems like this get worse when every party assumes it’s someone else’s to solve. Once access erodes in a community, especially in rural and underserved markets, rebuilding it is a lot harder than holding onto it in the first place.

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About the author: Ron DiGiaimo, MBA, FACHE Chairman, R3source Health: RCCS | Regents Health Resources | RC Billing

Ron DiGiaimo is the CEO and Chairman of R3source Health, a collective partnership between Regents Health Resources, RCCS, and RC Billing. With a background in radiation therapy, Ron now continues to assemble the best in the business to partner with clients across the country on everything from revenue cycle consulting and strategic planning to coding and reimbursement support.