2 - RBRVS RBRVS Resource Based Relative Value Scales...

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RBRVS RBRVS Resource Based Relative Value Scales
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Definition of RBRVS Definition of RBRVS Financing mechanism reimbursing providers on a classification system which measures training & skill required to perform a given health service
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RBRVS RBRVS Used to correct Medicare’s tendency to: Overcompensate for services (e.g. surgery, diagnostic tests) Underpay for primary care services
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Three Factors Which Three Factors Which Combined to Force RBRVS Combined to Force RBRVS Dissatisfaction with original payment system Escalation of Part B costs Promise of credible basis for new payment system
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Problems with Previous Problems with Previous System System Customary, prevailing, reasonable system (CPR) Some intermediaries had one prevailing charge Others had charges based on medical specialty Wide variations between physician specialties & geographic regions
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TEFRA 1983: TEFRA 1983: Precursor to RBRVS Precursor to RBRVS Use of a Prospective Payment System (PPS) to pay for hospital care for Medicare patients Standardized payment for each hospital admission Variation according to geographic differences in wage rates Variation according to whether hospital is urban or rural “Outlier” cases requiring longer LOS permits higher rate of payment
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TEFRA 1983: TEFRA 1983: Precursor To RBRVS Precursor To RBRVS Admissions are categorized according to 492 DRGs Payment based on national average cost for patients with that diagnosis Success of DRGs focused attention to physician reimbursement
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RBRVS Study: Phase 1 RBRVS Study: Phase 1 Hsiao & Braun conducted a 1985-1988 study to develop RBRVS for 12 medical specialties - Anesthesiology - Family Practice - General Surgery - Internal Medicine - OB/GYN - Ophthalmology - Orthopedic Surgery - Otolaryngology - Pathology - Radiology - Urology - Thoracic/ Cardiovascular Surgery
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RBRVS Study: Phase 1 RBRVS Study: Phase 1 Six additional specialties were funded independently & included in the study - Allergy & immunology - Dermatology - Oral & maxillofacial surgery - Pediatrics - Psychiatry - Rheumatology
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RBRVS Study: Phase 2 RBRVS Study: Phase 2 Added 15 specialties in 1990 - Cardiology - Emergency Medicine - Gastroenterology - Hematology - Infectious Disease - Nephrology - Neurology - Neurosurgery - Nuclear Medicine - Oncology - Osteopathic Medicine - Radiation Oncology - Plastic Surgery - Physical Medicine & - Pulmonary Medicine Rehabilitation
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RBRVS Method RBRVS Method 1 Total work units for a practice calculated by weighting RBRVS value for each procedure by its function 2 Total practice expenses then divided by total work units to arrive at a cost conversion factor (CCF)
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RBRVS Method RBRVS Method 3 CCF then applied to specific RBRVS for an individual service & this yields estimate of the relative costs of providing that service in a specific market 4 This estimate applies to physician services to which direct costs cannot be assigned i.e. visits, consultation, surgical procedures
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2 - RBRVS RBRVS Resource Based Relative Value Scales...

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