Here's a brief case study on how hospital outpatient payment is different from "physician fee schedule" payment, and how sudden changes can occur in the former.
Way back in 2011, AMA CPT created a new FISH code 88121 specifically for urine FISH with 3-5 biomarkers. (Prior to this, FISH from any source was paid in multiples of the number of markers, and CPT felt that urine FISH with 5 biomarkers should be priced as a single service. This resulted in a significant price cut, something like 50%, for applicable services).
In the non-facility setting, a pathology code is priced by RVU's, physician materials and work units. In the facility setting, the technical component of the code is priced by administrative assignment of the code to an "APC," an ambulatory payment category. This results in one price for any of a basket of services in that APC.
OK, so 88121 has been paid as 5673 "Level III Pathology' for $333. CMS found the median hospital charges calculate to $175. So CMS re-assigned 88121 down to 5672 "Level II Pathology" at $162.
This was a proposed rule in July 2022 and finalized in November 2022.
CMS received a number of protest letters, arguing that the APC Level II price was too low. CMS responded patiently that it prices hospital services by taking the geometric mean of claims charges (using a chart-to-cost deflation value) and that gave median hospital values of $175 which fits an APC whose payment is $162.
The moral is, a successful and high enough APC assignment for a new code can decay into a lower APC reassignment based on CMS's annual review of incoming hospital claims and charges.
I've put the CMS discussion (87 FR 71871) in a cloud PDF here.