Coding and RVUs

The changes in the work RVU component of the RBRVS scheduled for implementation this year can generate a dramatic increase in the revenue for a given practice; a lesser effect can occur from the practice expense RVU changes. For instance, CMS estimated that Internal Medicine practices would see an average increase of 5% in 2007 as a result of the increased value of office-based E&M services, among others. The purpose of this post is to emphasize that the ACTUAL increase a practice can expect cannot be determined without first doing a basic CPT code analysis - as Frank Cohen and I indicated in our recent (Fall 2006) CPA Expert article.

The typical IM practice in the Medicare database has about 30% of its established patient visits coded Level 4 and 55% coded Level 3. The increase in the value of the Level 4 code, however, is about 18% while the Level 3 increase is about 23%, using the fully phased in PE RVU values. This is dramatically different than the 5% estimate by CMS! A practice using primarily these codes and not providing in-hospital services (such as where a hospitalist is used) will see a very different change in revenue than the generic 5%.