iRhythm Technologies Provides Statement on Medicare Administrative Contractor (MAC) Novitas’s Updated Rate Publication and Provides Commentary on Results for the First Quarter 2021 - Seite 2
iRhythm has analyzed the impact the updated Novitas rates would have had on full year 2020 reported revenue and gross margin had those rates been in effect in 2020. The updated Novitas rates would have negatively impacted 2020 Medicare revenue by $41.3 million and would have decreased 2020 total company revenue from $265.2 million to $223.8 million, or a decrease of 15.6%. In addition, 2020 total company gross margin would have decreased from 73.5% to 68.6%. For the year ended December 31, 2020, Medicare represented 27% of iRhythm’s overall revenue, with a small percentage of that 27% attributable to Zio AT and Zio XT for wear of less than 48 hours, which services are priced nationally and not impacted by the updated Novitas rates.
The following table presents the impact the Novitas rates would have had on full year 2020 reported revenue and gross margin in thousands:
|As disclosed||Novitas Impact||Adjusted|
Preliminary First Quarter Financial Results
The company estimates that volume for the three months ended March 31, 2021 grew 9% over volume in the fourth quarter of 2020. In addition, the company estimates that the updated Novitas rates when compared to historical 0297T rates will have a negative $13.0 million impact to first quarter 2021 revenue.
The first quarter 2021 financial results included in this release are preliminary and therefore subject to change.
Webcast and Conference Call Information
iRhythm will host a conference call today, April 12, 2021, at 5:30 AM PT / 8:30 AM ET to provide commentary on the impact to its business resulting from the newly published Novitas rates. Investors interested in listening to the conference call may do so by accessing the live and archived webcast of the event available on the “Investors” section of the company’s website at: www.irhythmtech.com.