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Breast imaging has a deserved reputation as a very difficult financial proposition for hospitals. Regulation, low reimbursement, costly new technologies and staff shortages all combine to create an operational environment that is difficult, at best. While it may not be possible for every hospital to make breast imaging profitable, it is the obligation of every hospital to make this and all service lines as cost-effective as possible. While the typical care episode in a hospital will include several different services or procedures, the breast-imaging patient is typically in the department or breast center for a single procedure. Consequently, all of the administrative and facility costs of the patient encounter must be borne by the reimbursement for the single procedure. Breast imaging involves relatively expensive technology and highly-trained, and costly, technologists in its delivery. The costs of these inputs are relatively fixed; therefore material improvement can only be realized through the redesign of process. Analysis of the process of care delivery is critical to any discussion of the economics of breast imaging. Breast imaging can basically be divided into two categories: screening mammography and diagnostic procedures. This is a very important distinction, because screening mammography requires only general supervision, while the balance of breast imaging requires the direct supervision of the physician. Decoupling the physician from the examination allows the organization of screening delivery programs in highly efficient, high-throughput systems. On the diagnostic side of breast imaging, the primary economic enhancement that can be realized is from the delivery of more than one procedure during the patient visit. Mammography has high fixed costs (technology and technologist) and, where high fixed costs are found, profitability is determined by process and volume. Where process can be optimized to a level that will allow a positive return for each mammogram, volume becomes a multiplier. Responding to congressional pressure exerted in 2001, CMS increased the 2002 payment rate (global) for screening mammography from $69.23 (2001) to $81.81. The increase, however, was a mixed blessing, as it was all in the professional component ($22.18 to $35.48). In fact, the technical component was actually reduced by $0.74 from $47.07 to $46.33. While the reduction in payment for producing the screening mammogram is unjustified by the costs of producing that exam, the hardest blow was reserved for the payment rates for diagnostic mammography. As previously discussed, improving process and increasing volumes will improve the financial picture, but the problem of a single, low, procedure reimbursement remains. The implementation of CAD, however, has the ability to change that reality. CMS treats CAD as an add-on procedure. It cannot be billed as a stand-alone charge, but it is paid when billed in conjunction with a screening or diagnostic mammogram. The implications of the add-on character of CAD reimbursement are disproportionate to the amount of the payment, because it does not have to carry any costs other than those directly involved in its delivery. Breast imaging in general, and mammography specifically, will continue to present a challenge to the radiology administrator. With proper attention to process and volumes, and the very important contribution of CAD, however, breast imaging has the potential to not only pay its own way but to become profitable.