The Relative Value Unit: History, Current Use, and Controversies

Price adjustment for traditional Chinese medicine procedures: Based on a standardized value parity model

“…The current study analyzed the value of medical care provided and the cost of direct materials consumed, and it devised a method of adjusting the prices of medical procedures based on a standardized value parity model. The United States and other countries use a pricing theory based on relative units (26,27). A relative value unit (RVU) is assigned to the three components of medical services -work, practice expense, and professional liability insurance -resulting in work RVUs, practice expense RVUs, and professional liability insurance RVUs.…”

Health Care Economics: A Study Guide for Neuroradiology Fellows, Part 1

“…Multiple procedure payment reduction (MPPR) is a very controversial element of radiology reimbursements. 4 This cost-saving scheme was first proposed by CMS in 2006 across multiple code families, including those related to radiologic imaging; it applies to advanced imaging examinations defined as sonography, CT, CT angiography, MR imaging, and MR angiography. In this practice, Medicare will fully reimburse for the most expensive examination when multiple imaging examinations are performed on a single patient by the same physician or group during a single health care encounter (single patient session), but it will reduce reimbursements for subsequent imaging examinations performed during that encounter.…”

“…This practice was implemented in a graded manner during several years, 4 with a 25% reduction in 2006 to the TC of advanced imaging examinations of adjacent anatomy performed by the same physician, on the same patient, on the same day. In 2010, this reduction increased to 50% through the Affordable Care Act.…”

“…It is estimated that the total losses in both TC and PC imaging fee reimbursement due to the implementation of the MPPR policy were approximately $1.2 billion from 2006 to 2013. 4 According to the CMS, the primary rationale for these cuts to reimbursement related to redundant work within both the TC and PC, when patients undergo multiple imaging examinations during a single day. 4 The justification for reducing the TC reimbursements related to activities that are not repeated during multiple examinations on the same patient during the same encounter, such as preparing and cleaning the examination room, educating the patient, obtaining informed consent, placing an IV line, and so forth.…”

“…Radiology services comprise 2 distinct billable elements, the technical component (TC) and the professional component (PC). 4 The TC is that portion of the global fee that reflects the cost of operating and maintaining the medical equipment, the cost of medical supplies, the cost of renting or purchasing the real estate that houses the equipment, the cost associated with having radiologic technologists who perform the examinations, and so forth. The PC refers to the cost associated with the radiologist's interpretation of the examination, which includes the written radiology report, which is the sum of the physician work, practice expense, and professional liability insurance inherent in the production of the report.…”