# RVU's



## hardtail58 (Jan 8, 2010)

Hello. PLEASE somebody help me, my job is on the line!

In plain English how do you compute the prices of services using the RVU's

RVU amount times what dollar figure? Should it be based on contract rates? or just geographical?

We only collected about 43% of our billed charges last year.


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## FTessaBartels (Jan 8, 2010)

*Before you panic*

I don't have a specific answer to your question because that's outside my realm of responsibility.

But, before you panic about your reimbursement rate ... look at a couple of possiblities

Have you had a major shift in payer mix (more government payers vs commercial)?  Definitely a possibillity with the economy as it is; fewer people with employer-paid health insurance. 

Do you have a lot of multiple procedure operative sessions?  The second procedure will get a 50% reduction. Depending on the payer, the third and subsequent procedures may get a 75% reduction. 

Have you brought on PA or NP who are assisting at surgery (the bill goes out with the same fee, but the reimbursement is only about 16-20%)? One of our divisions brought in 4 PAs last year, all of whom assist at surgery (BIG-dollar surgeries). Charges went WAY up; reimbursement rate took a major hit. 

Hope that helps.

F Tessa Bartels, CPC, CEMC


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## hardtail58 (Jan 8, 2010)

FTessaBartels said:


> I don't have a specific answer to your question because that's outside my realm of responsibility.
> 
> But, before you panic about your reimbursement rate ... look at a couple of possiblities
> 
> ...



We haven't really had two many increases except switching from Medicare to an Medicare Advantage plan. A few more Medicaid patients. The vast majority of our patients are commercial insurance or self pay.

This is a sole physician who has done a lot of assistant surgeries this past year. He doesn't quite understand that we have to bill at the primary surgeon's rate and not the assistant's rate.


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## FTessaBartels (Jan 10, 2010)

*Assistant Surgeon*

Well, the assistant surgeon's fee goes out at the regular rate, but the reimbursement is only 16-20% of the primary surgeon's rate.

So let's say you have procedure CPT xxxxx which has a fee of $5,000.  Medicare's reimbursement rate on the procedure is $2,500. An assistant surgeon will be paid 20% of *that* or $500.  

That would definitely impact your reimbursement rate. 

Or if it is a commercial payer ... you bill CPT xxxxx-80, with a fee of $5,000.
Your contract has a reimbursement rate of 80% or $4,000 for primary surgeon. Assistant surgeon gets 20% of *that* or $800.

Still a hit on your reimbursement rate.

Hope that helps.

F Tessa Bartels, CPC, CEMC


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## hardtail58 (Jan 12, 2010)

*RVU"s*

Thank you. Now what is the best convertion factor to multiply RVU's by? 
I think I over adjusted for my doctor not updating for 3 years and went to far..I used $115..when I should have left it at the $100 and just updated the RVU's.

Does anyone have any ideas as to how doctors can take advantage of the large w/o for taxes??


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## code@home (Jan 13, 2010)

I have just a quick question in regards to the fee schedules, is it the physician who calculates his fee schedules and monitors the changes, or is it us as coders or billers to monitor the changes and calculate their prices or rates?  Also, is it CMS who's fee schedule we follow and calculate for all charges or does each insurance company have their own?  Any help would be great!!!

Thanks Lisa


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## ktb_thomas (Jun 8, 2010)

*How to Calculate a CPT Code’s Allowable*



hardtail58 said:


> Hello. PLEASE somebody help me, my job is on the line!
> 
> In plain English how do you compute the prices of services using the RVU's
> 
> ...



Per this web site: 
http://www.aao.org/aao/publications/eyenet/200706/practice_perf.cfm
A Formula With 8 Components

Medicare's allowable for a given CPT code is derived from a formula (see box) that contains eight components: three RVU values, three Geographic Practice Cost Index (GPCI) values, the Budget Neutrality Adjustor and the Conversion Factor.

How to Calculate a CPT Code's Allowable 
Using the formula below, first plug in the three Relative Value Unit (RVU) values that have been assigned to the CPT code and the three Geographic Practice Cost Index (GPCI) values that have been assigned to the locality where you are practicing; next plug in the Budget Neutrality Adjustor (which is 0.8994) and Conversion Factor (37.8975); and then it's a simple matter of multiplication and addition.

[ ((Work RVU x Budget Neutrality Adjustor)* x Work GPCI)
+ (Practice Expense RVU x Practice Expense GPCI)
+ (Malpractice RVU x Malpractice GPCI) ] = Geographically Adjusted RVU Total

x Conversion Factor

= Allowable Amount


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