This transcript has been edited for clarity.
The other day, I received a flowery, elaborate email from none other than a physician recruiter: “Beautiful parks, hiking, great schools, blah blah blah, worked RVU production bonus on top of base pay.”
That last part – RVUs. I’m lost. I hear mixed reviews from physicians who work in RVU-based systems. The entire thing seems overly complex and confusing, so let’s clear it up. I did my research, and I’m going to explain RVUs.
Types of RVUs
RVUs, or relative value units, are a standard set by Medicare, used to measure physician productivity and ultimately determine compensation. There are three types:
- Work RVUs (basically everything that happens during a patient encounter).
- Practice expense RVUs.
- Professional liability insurance RVUs.
Now, envision this equation. All three of those RVUs are each multiplied by a geographic practice cost index to come up with a total number, and then that is multiplied by the Medicare conversion factor, which right now is around $33 to $34, to come up with a total dollar amount.
Work RVUs make up the bulk of total RVUs and they get their value from CPT codes. That value is determined by CMS. The AMA’s Relative Value Scale Update Committee, or RUC, which is made up of 32 people from various medical and surgical subspecialties, regularly meets and makes recommendations on the value of various CPT codes.
Is specialty representation fair and balanced?
CMS historically has accepted a high percentage of RUC’s recommendations, so this is a very influential committee. This is also why RUC has led to some controversy, with some stating that there is a lack of primary care representation, and perhaps this is why CPT codes related to procedures tend to reimburse higher.
How does one weigh the value of an hour-long palliative conversation against the quick removal of a benign skin lesion? That’s a loaded question.
This is especially important if your salary, or at least part of it, is determined by total RVUs. You want to have a sense of the pros and cons of working in an RVU system and how this relates to your specialty, your practice, and your schedule.
An RVU-based system provides an objective measure on complex patient encounters, volume, and procedures, and it’s a somewhat unified measure. The cons are pretty clear because these models favor you seeing many patients and billing a lot, and often this favors employers over physicians.
Dr. Patel is a clinical instructor, department of pediatrics, at Columbia University, New York, and a pediatric hospitalist at Morgan Stanley Children’s Hospital of New York–Presbyterian. He reported a conflict of interest with Medumo.
A version of this article first appeared on Medscape.com.