Cover: Development of a Model for the Validation of Work Relative Value Units for the Medicare Physician Fee Schedule
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Development of a Model for the Validation of Work Relative Value Units for the Medicare Physician Fee Schedule

by Barbara O. Wynn, Lane F. Burgette, Andrew W. Mulcahy, Edward N. Okeke, Ian Brantley, Neema Iyer, Teague Ruder, Ateev Mehrotra

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The Centers for Medicare & Medicaid Services (CMS) uses the resource-based relative value scale to pay physicians and other practitioners for professional services. The work values measure the relative levels of professional time and intensity (physical effort, skills, and stress) associated with providing services. CMS asked RAND to develop a model to validate the work values using external data sources. RAND's goal was to test the feasibility of using external data and regression analysis to create prediction models to validate work values. Data availability limited the models to surgical procedures and selected medical procedures typically performed in an operating room. Key findings from the study include the following: RAND estimates of intra-service time using external data are typically shorter than the current CMS estimates. Model assumptions about how shorter intra-service times affect procedure intensity have implications for the work estimates. RAND estimates for work on average were similar to current work values if shorter intra-service time is assumed to increase procedure intensity and were on average up to 10 percent lower than current work values if shorter intra-service time is assumed to not impact on procedure intensity. The RAND estimates could be used for two key applications: CMS could flag codes as potentially misvalued if the RAND estimates are notably different from the current CMS values. CMS could also use the RAND estimates as an independent estimate of the work values. In some cases, further review will identify a clinical rationale for why a code is valued differently than the RAND model predictions.

Table of Contents

  • Chapter One

    Introduction

  • Chapter Two

    Descriptive Statistics of Total Work and Components of Work

  • Chapter Three

    Methodological Approach and Data

  • Chapter Four

    Intra-Service Times for Single Procedures

  • Chapter Five

    Pre-Service and Immediate Post-Service Work

  • Chapter Six

    Post-Operative Evaluation and Management Work

  • Chapter Seven

    Intra-Service Work and Intra-Service Intensity (IWPUT)

  • Chapter Eight

    Estimating Total Work RVUs

  • Chapter Nine

    Other Issues

  • Chapter Ten

    Key Findings and Potential Applications of the RAND Models

  • Appendix A

    Defining Core Codes for Analyses

  • Appendix B

    Explanation of Code Groupings

  • Appendix C

    Explanation of Variables Used to Characterize Each Service

  • Appendix D

    Estimating Surgical Times from Anesthesia and OR Times

  • Appendix E

    A Bayesian Approach to Estimating Intra-Service Times

  • Appendix F

    Multiple Procedures and Add-On Procedures

  • Appendix G

    Regression Output from Pre-Service, Intra-Service, Post-Service, and Total Work Prediction Models

  • Appendix H

    Comparison of Unweighted Means in RAND Estimates to CMS Estimates

This study was funded by the Centers for Medicare & Medicaid Services. This research was conducted in RAND Health, a division of the RAND Corporation.

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