Primary Care Doctor RVUs vs. Specialist RVUs: Pay Rates Revealed

This video provides an in-depth exploration of how physician payments are determined in the U.S. healthcare system, focusing on Relative Value Units (RVUs) and Current Procedural Terminology (CPT) codes. Dr. Eric Bricker, a healthcare finance expert, highlights how primary care and non-procedure physicians often get financially disadvantaged due to the opaque nature of these payment mechanisms. The core message is to empower these doctors to understand and optimize their revenue by strategically engaging with commercial insurers that offer better compensation for preventive care and chronic disease management.

The presentation meticulously breaks down the mechanics of RVUs and CPT codes. It explains that CPT codes are five-digit identifiers for every medical service, each assigned a specific number of "work RVUs." These work RVUs, in turn, dictate how much Medicare and commercial insurance companies pay physicians. A critical distinction is drawn between the payout rates of Medicare, which for 2023 was $33.06 per work RVU, and commercial insurance, which can be as high as $70 per work RVU. This significant difference means that the same medical service can yield vastly different revenues depending on the payer.

A central point of controversy discussed is the role of the American Medical Association's (AMA) Relative Value Scale Update Committee (RUC). This committee, composed of doctors from various specialties, determines the work RVU values for each CPT code. The video argues that the RUC tends to assign significantly higher work RVUs to procedural CPT codes (e.g., cardiac catheterizations) compared to codes for office visits focused on prevention and chronic disease treatment. This disparity, the speaker contends, financially incentivizes a "sick care system" where treating existing illness is far more rewarding than preventing it, leaving primary care physicians at a disadvantage. To counteract this, non-procedure doctors are advised to understand their revenue mix from different payers, know the specific RVU payout rates of various commercial insurers, and strategically work with payers that value and adequately compensate for preventive care.

Key Takeaways:

• RVUs and CPT Codes are Foundational to Physician Payment: The U.S. healthcare system uses Work Relative Value Units (RVUs) tied to Current Procedural Terminology (CPT) codes as the primary method for determining how much physicians are paid by Medicare and commercial insurance companies.
• CPT Codes Categorize Medical Services: CPT codes are standardized five-digit codes used to describe every medical service or procedure a doctor performs, serving as the basis for billing.
• Work RVU Values Vary by Service: Each CPT code is assigned a specific number of work RVUs, reflecting the relative effort, skill, and risk involved in providing that service. For example, a 20-minute office visit (CPT 99202) is assigned 1.73 work RVUs, while a heart catheterization (CPT 92928) is assigned 11.21 work RVUs.
• Significant Payout Discrepancy Between Medicare and Commercial Insurance: Medicare's payout rate per work RVU is substantially lower than that of commercial insurers. In 2023, Medicare paid $33.06 per work RVU, whereas commercial insurance could pay up to $70 per work RVU, leading to major revenue differences for the same service.
• Financial Impact on Physicians: This difference means a 20-minute office visit could be worth $57.19 from Medicare but up to $121 from commercial insurance, and a heart catheterization could yield $370.60 from Medicare versus $785 from commercial insurance.
• The RUC Committee Influences RVU Values: The American Medical Association's (AMA) Relative Value Scale Update Committee (RUC), comprised of doctors from various specialties, is responsible for determining the work RVU values for CPT codes.
• Bias Towards Procedural Codes: The RUC's methodology is criticized for assigning significantly higher work RVUs to procedural CPT codes compared to codes for preventive care and chronic disease management, creating a financial imbalance.
• "Sick Care System" Incentive: This RVU structure inadvertently fosters a "sick care system" where the financial rewards for treating existing illnesses and performing procedures are far greater than those for preventing diseases and maintaining health.
• Actionable Strategy for Non-Procedure Doctors: Know Your Payer Mix: Physicians should understand the percentage of their revenue derived from Medicare versus various commercial insurers to identify potential areas for optimization.
• Actionable Strategy for Non-Procedure Doctors: Understand Payout Rates: It is crucial for doctors to know the specific work RVU payout rates offered by different commercial insurers for the CPT codes they most frequently use.
• Actionable Strategy for Non-Procedure Doctors: Optimize Payer Engagement: To maximize revenue, non-procedure doctors should strategically prioritize working with commercial payers that offer the highest work RVU pay rates for preventive care and chronic disease treatment, thereby recognizing the value of keeping people healthy.

Key Concepts:

• Work RVUs (Relative Value Units): A standardized measure of the amount of physician work involved in providing a service, including time, effort, technical skill, mental effort, and stress.
• CPT Codes (Current Procedural Terminology): A medical code set used to report medical, surgical, and diagnostic procedures and services to entities such as physicians, health insurance companies, and accreditation organizations.
• RUC (Relative Value Scale Update Committee): A committee run by the American Medical Association (AMA) that recommends relative values for new and revised CPT codes to the Centers for Medicare & Medicaid Services (CMS).
• "Sick Care System": A term used to describe a healthcare system that primarily focuses on treating illness after it has occurred, rather than emphasizing prevention and wellness.

Examples/Case Studies:

• CPT Code 90210: Used as an illustrative example of a CPT code, referring to an injury to the inferior vena cava, contrasting it with its common association as a zip code.
• CPT Code 99202: Represents an office visit for a new patient lasting about 20 minutes, assigned 1.73 work RVUs.
• CPT Code 92928: Represents a heart catheterization with stenting, assigned 11.21 work RVUs.
• Financial Comparison: The video contrasts the Medicare payout for CPT 99202 ($57.19) with a potential commercial insurance payout ($121), and for CPT 92928, Medicare pays $370.60 while commercial insurance could pay $785.