Resource-based relative value scale (RBRVS) is a fee schedule that uses a complex formula to determine the payment due a physician for patient services. Factors that are considered in determining the payment due include the resources used, practice expenses, malpractice expenses, geographic location, and whether the devices were provided on an outpatient or inpatient basis. Medicare began phasing in this PPS in 1992. The practical effect has been to diminish reimbursement for procedures such as cardiac surgery and raise reimbursement for primary care office visits.
The RBRVS fee schedule applies to:
• Physicians (including limited license practitioners).
• Services “incident to” physician services.
• Radiology services (including MRI).
• Outpatient, physical, speech language pathology and occupational therapy.
• Other diagnostic tests (with the exception of clinical laboratory tests).
• Non-physician practitioners, but at reduced rates (generally limited to 85% of the physician fee schedule amount).
The fee schedule also limits reimbursement to physician’s assistants, nurse practitioners, clinical nurse specialists, nurse midwives, and certified registered nurse anesthetists who receive certain percentages of the fee schedule amount.
The Medicare payment amount under the fee schedule is 80% of the lesser of: the physicians’ actual charge; or the fee schedule for each service. The patient is responsible for the other 20% (the coinsurance) as well as the applicable Part B deductible.
Excerpt from Barry D. Alexander, Medicare Part B, Institute on Medicare & Medicaid Payment Issues (American Health Lawyers Association Mar. 2009).