“There is no medicine like hope, no incentive so great, and no tonic so powerful as expectation of something tomorrow.”
Orison Swett Marden (1850-1924)
“Regardless of the elegance of the plans, one must occasionally look at the results.”
How should emergency physicians be paid? This question increasingly resonates through emergency medicine as described by its organizations and publications. There is a plethora of described methodologies, from an hourly rate to pure productivity systems. Each has its intended and unintended consequences. This chapter will describe the underpinnings of the current payment system, demonstrate the creation of productivity-based systems, and list the advantages and disadvantages of each.
Prior to the current Resource-Based Relative Value Scale (RBRVS) system, there was no good definition of or way to quantify physician work. Physicians were paid utilizing a fee-for-service system based on the “customary, prevailing, and reasonable” charge structure, established with the creation of the Medicare program in 1965. In an effort to directly measure and attach payments to actual work performed by physicians, Congress required the Health Care Financing Administration (CMS [Centers for Medicare and Medicaid Services]) to develop an RBRVS system.
On January 1, 1992, the Medicare program implemented the RBRVS system.1 The American Medical Association (AMA) developed and currently maintains the RBRVS program. The AMA looks at multiple variables when analyzing reimbursement, including actual work, opportunity cost of training, practice expense, malpractice expense, the geographic location of the practice, and so on. By considering all factors, the program attempts to define the total work expense to see a patient, to provide a service, and to perform a procedure. This process has been standardized and listed for each specialty.
Over the years this payment reform spread from Medicare to most payors. Currently, all physicians who practice in the United States and are reimbursed by CMS and insurance companies are paid by relative value units (RVUs). A number of RVUs are assigned to each reimbursable task, service, and procedure performed by a medical practitioner (Box 73-1). All practitioners use the same CPT (Current Procedural Terminology), which ensures uniformity. As the practice of medicine changes, new codes are developed and older codes are modified or discarded.
Box 73-1 the 2011 RVUs Attributable to an Examination/Procedure |Favorite Table|Download (.pdf)
Box 73-1 the 2011 RVUs Attributable to an Examination/Procedure
Level 3 examination
I & D abscess
Once an RVU is assigned, it is multiplied by the value of the RVU, the conversion factor. Medicare payments for each RVU have varied over the years between $33 and $39 and are the same for all specialties whether emergency medicine or neurosurgery. CMS and insurance ...