Under the Resource Based Relative Value System (RBRVS), each service is broken down into a work component, a practice expense (PE) component and a professional liability insurance (PLI) component. A relative value unit (RVU) is assigned to each of these components and each RVU value is then geographically adjusted. The sum of the adjusted RVUs is multiplied by a single, national conversion factor (dollar amount per unit). This differs from the methodology used to determine anesthesia payments where each service is assigned a base unit value. Payment is determined by adding the base unit value with the number of time units reported and multiplying that sum by a conversion factor that is regionally adjusted. Unlike RBRVS, with anesthesia, the base units are held constant and the conversion factor is geographically adjusted.
A comparison of Medicare payments under RBRVS between 2011 and 2010 includes an additional consideration this year; one cannot simply look at the conversion factor. This is because CMS has revised and rebased one of the variables that contribute to the conversion factor, namely the Medicare Economic Index (MEI). CMS is implementing the changes that result from this revision and rebasing by adjusting the RVUs for the PE and PLI components of services paid under RBRVS. The work portion is being adjusted via a change to the conversion factor. Since anesthesia base units do not break down into work, PE and PLI components, all changes are reflected in the conversion factor.
Anesthesiologists perform many services that are paid under the RBRVS; most notably pain procedures and line placements. We have seen warnings that physicians should anticipate an 8% decrease in their Medicare payments because the RBRVS conversion factor is falling by approximately that amount. A more robust review is required. Remember, both the RVUs and the conversion factor contribute to your payments. Click here for a spreadsheet that provides a comparison of the payment calculations for selected services performed by anesthesiologist and paid by Medicare under RBRVS. (Note:This example does not include geographic adjustments nor does it include codes that have been revised or revalued for 2011.)
Key findings from review of these selected codes: In the non-facility setting most of the services listed on the spreadsheet actually see a moderate to significant increase, while in the facility setting the changes are smaller with a mix of increases and decreases.