Practice managers who need to understand the ins and outs of Medicare's resource-based relative value scale (RBRVS) can purchase an updated physician guide from the American Medical Association.
Practice managers who need to understand the ins and outs of Medicare’s resource-based relative value scale (RBRVS) can purchase an updated physician guide from the American Medical Association. The RBRVS is used to determine how much money medical providers should be paid.
RBRVS assigns procedures performed by a physician or other medical provider a relative value which is adjusted by geographic region (so a procedure performed in Manhattan is worth more than a procedure performed in Dallas). This value is then multiplied by a fixed conversion factor, which changes annually, to determine the amount of payment. RBRVS determines prices based on three separate factors: physician work (54%), practice expense (41%), and malpractice expense (5%).
The physician work component accounts, on average, for 48 percent of the total relative value for each service. The factors used to determine physician work include the time it takes to perform the service; the technical skill and physical effort; the required mental effort and judgment; and stress due to the potential risk to the patient.
The practice expense component of the RBRVS accounts for an average of 48 percent of the total relative value for each service.
The 23rd edition of the guide provides the following updates:
· New payment rules for 2014 CPT codes that provide an explanation of how they may affect a practice.
· Correct payment schedule calculations with updated payment policies, payment calculations and information on appropriate use of modifiers.
Annual updates to the physician work relative values are based on recommendations from a committee involving the AMA and national medical specialty societies. Nearly 8,000 procedure codes are defined in CPT, and the relative values in the RBRVS were originally developed to correspond to the procedure definitions in CPT. Changes in CPT necessitate annual updates to the RBRVS for the new and revised codes.