Discussions with a group of physicians regarding employment status of your hospital are taking place. If the physicians were employed by your hospital, they would be performing all surgical procedures at your hospital instead of in their current offices. This could mean a sizable change in total revenue, especially from Medicare patients. To see the effect of this change, assume the example in Table 3-7 for CPT #42810, excision of a neck cyst.

If Medicare pays the hospital $1,600 for the facility fee and the physicians receive $370.80, calculate the amount the physicians would lose if the procedure were paid in a nonfacility setting. Assume the nonfacility practice expense weight is 7.39.