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Physician services in an academic neurology department: using the resource-based relative-value scale to examine physician activities.

The inability of physician managers and decision makers to critically analyze the resource utilization of physicians has hindered a more comprehensive understanding of the role of neurologists in the patterns and organization of medical practice. This article outlines an approach for using the physician work relative value units (RVUs) in the Medicare Fee Schedule (MFS) to address this problem and profile physician clinical activities in a comparative manner. These techniques are then used to profile the physician services associated with the neurology department at a large academic hospital. All 28,048 physician services associated with a neurology department in 1995 were studied. Using billing data, physician work RVUs were assigned to each service and the results analyzed by major services, type of service, and physician workload for physician work RVUs and physician charges. For the average service, mean physician charges were $187 per service while median physician charges were $120. Mean physician work RVUs per service averaged 1.3 RVUs, and the median was 0.94 per service. Of all the services provided in the neurology department, 65 percent are visits and consultations, while medicine services (e.g., nerve conduction studies, needle electromyography, neuropsychological testing, and electroencephalogram) make up 31 percent. All the other services combined represented less than five percent of the services in the department. The top five physicians in the department account for 33 percent of all physician work RVUs in the neurology department. Using the physician work relative values in the MFS provides a unique perspective for analyzing and understanding neurologists' work activities.

Academic Medical Centers↗

Development and implementation of a relative value scale for teaching in emergency medicine: the teaching value unit.

UNLABELLED: Relative value units exist for measuring clinical productivity. Limited objective measures exist, however, for nonclinical activities, specifically teaching. OBJECTIVE: To develop an objective measure of teaching productivity linked to a performance-based incentive plan. METHODS: Teaching goals and objectives were identified before the 1998-1999 academic year. Teaching value units (TVUs), objective measures for quantifying teaching activities, were developed and assigned based on an estimation of time needed to complete each activity and weighted for importance to the teaching mission. Each physician was allocated teaching time based on past performance and future goals. Targeted TVUs necessary to meet expectations were proportionate to allocated teaching time. Teaching productivity was defined as a percentage of targeted TVUs achieved. Incentive dollars for teaching were distributed based on percentage of targeted TVUs achieved, weighted individually for teaching load. RESULTS: Teaching productivity was evaluated over a three-year period. In year 1, mean TVUs allocated/physician were 181 units (range 25 to 449). Four of 18 physicians (22%) met expectations. The mean individual TVUs achieved were 54% of expected (range 0% to 114%). By year 3, mean TVUs allocated/physician were 179 (range 45 to 629). Twelve of 22 physicians (55%) met expectations. The mean individual TVUs achieved were 82% of expected (range 11% to 146%). Between year 1 and year 3, group productivity increased from 73% to 88%, and mean individual productivity increased from 54% to 82% (p = 0.01). CONCLUSIONS: The development of a TVU-based system enabled objective quantification and monitoring of a broad range of teaching activities. The TVU-based system linked to an incentive plan helped to increase individual and group teaching productivity.

Emergency Medicine↗

Incorporating practice costs into the Resource-Based Relative Value Scale.

Practice costs (not including liability insurance costs) account for approximately 41% of the payment for medical and surgical services in the Medicare Fee Schedule. Unlike the portion of the fee schedule that compensates physicians for their work, the practice cost portion of the Medicare Fee Schedule is not resource-based; it is based instead on historical charges. As a result, physicians can recover their practice costs in less time and with less effort (measured in work relative value units) by performing invasive procedures and tests than by providing evaluation and management services. The Physician Payment Review Commission has proposed, in some detail, a method for incorporating practice costs into the Medicare Fee Schedule. The method involves allocating indirect costs on the basis of physician work plus direct costs. We find, using their own analytical framework, that indirect costs should rather be allocated on the basis of time. But to better serve the goal of incentive neutrality, and to make practice cost payments more equitable, the payment a physician receives for practice costs should be based not on service mix and volume, but on characteristics of the physician's practice more closely related to practice costs: for example, whether the physician has an office, or whether the physician practices alone or in a group.

Cost Allocation↗

RBRVS (Medicare Resource-Based Relative Value Scale) revisited.

Medicare RBRVS has become widely used as a standard for physician fee scales by both traditional health insurance plans and managed care organizations. There are significant variations in the way RBRVS has been adapted by these private payers. These variations, when combined with changes Medicare has made to the underlying components of RBRVS, may result in unintended and unexpected increases in physician payments. To avoid surprises, payers using RBRVS-based fee scales need to carefully evaluate the overall impact of annual RBRVS modifications on their delivery systems.

Fees, Medical↗

Medicare's resource-based relative value scale, a de facto national fee schedule: its implications and uses for neurologists.

The institution of the RBRVS as a basis of Medicare reimbursement corrects some long-standing inequities. First, it corrects the magnitude of reimbursement of procedures compared with cognitive services. Second, it corrects unexplained geographical variations in reimbursement. The RBRVS continues to go through refinement. The 5-year review and HCFA's practice expense project are likely to further improve reimbursement for cognitive services. Furthermore, because of the strengths of the scale, the RBRVS is now employed by most payors and is a useful practice management tool. Relative to other specialties, particularly the surgical specialties, neurology has in general benefited from these changes. Yet the RBRVS only addresses the rate of reimbursement; the proliferation of plans and insurance products with different coverage and payment policies and different procedures vastly complicates medical practice management. Understanding the development and evolution of the RBRVS is one necessary element of competent practice management.

Fee Schedules↗

Evaluation and management services in the Resource-Based Relative Value Scale.

Evaluation and management (E/M) services, which include making diagnoses, counseling and educating, developing strategies of care, and following up on treatment, are common to all medical specialties. Surveys of a variety of specialists using the magnitude-estimation method show that physicians agree closely in rating the work of particular E/M services. Regardless of the type of E/M service, the site at which it is performed, or the specialty performing it, work per unit of time varies only slightly. Comparison of work and time for services to which experts assigned billing codes in our consultative process indicates, however, that there may be large differences in the way different specialties use these billing codes. In some instances, work entailed by some of the E/M billing codes within specialties also appears to vary substantially. If empirical studies of physicians' coding and billing practices support our findings, possible responses might include (1) developing specialty-specific resource-based relative values for E/M services and (2) redefining the Physicians' Current Procedural Terminology, edition 4, codes for these services in terms that include time specifications.

Economics, Medical↗