How the Sausage Is Made: The RVU Process in Modern Medicine

Every year, small, randomized groups of clinicians receive a request to participate in a survey from their medical specialty society to evaluate Current Procedural Terminology (CPT) codes. Though they take only 15 to 20 minutes to complete, these surveys can help shape fee schedules across both government and private insurance.

For many physicians, the relative value unit (RVU) process can feel complex and removed from day-to-day patient care. For clinicians who are not directly involved, it may be unclear how the process works or why it matters.

“RVUs are used to calculate how much healthcare providers should be reimbursed for a specific service or procedure,” explains Katina Nicolacakis, MD, a staff pulmonologist at Cleveland Clinic and an advisor for the American Thoracic Society to the AMA RUC committee. “The annual surveys help inform RVU assignments, so participation helps ensure the work involved is represented accurately.”

An overview of the process

When Medicare shifted to a physician payment system based on the resource-based relative value scale (RBRVS), RVUs were adopted to measure the time, skill and resources required to provide medical services.

In response to Medicare’s shift in 1991, the American Medical Association (AMA) created the AMA/Specialty Society RVS Update Committee (RUC), a multi-specialty committee that advises Medicare and the federal government on payment rates for medical procedures.

The CPT Editorial Panel, which works with the RUC, defines and updates the codes used to describe new and revised medical procedures, surgeries and tests.

When a new procedure emerges, a CPT code is proposed and approved through a formal process. Once the code is created, professional societies survey clinicians to gather data on the physician work involved, including time, intensity and complexity.

Dr. Nicolacakis notes that RVUs apply to the professional component of reimbursement. “There is a completely separate set of rules and reimbursement for what we call the technical component, which is what the hospital, or practice, is reimbursed for.”

Organization of the RUC and CPT Editorial Panel

Understanding how the CPT Editorial Panel and the RUC are organized helps explain how coding changes move through the system. The CPT Editorial Panel is a 21-member panel authorized to revise, update and modify CPT codes. Nineteen seats are held by physicians nominated by a range of stakeholders, including medical societies, insurance associations and hospital associations.

The RUC represents the entire medical profession, with 21 of its 32 members appointed by major national medical specialty societies.

Four RUC seats rotate on a two-year basis: one is reserved for a primary care representative, two for internal medicine subspecialties, and one for another specialty society that is not already a member of the RUC.

Each of the approximately 125 specialty societies represented in the AMA House of Delegates appoints a physician to serve on the Advisory Committee to the RUC. If there is a relevant coding change, specialty societies that are not in the AMA House of Delegates may also be invited to help develop relative values for changes affecting their members.

“Pulmonary doesn't have a permanent seat, but we qualify for the internal medicine rotating seat and have served in this capacity in the past,” says Dr. Nicolacakis. “I am the advisor for the American Thoracic Society to the RUC committee, and with my three colleagues, we attend three meetings a year on behalf of ATS and CHEST.We also have a team that attends the three CPT meetings annually. These positions are all volunteer, and fortunately, Cleveland Clinic understands the importance of this process and allows me the time to attend and participate in the process on behalf of our ATS members.”

In her role, Dr. Nicolacakis helps the society prepare RUC surveys and present at RUC meetings, participating in the process which aims to ensure appropriate reimbursement for the services ATS and CHEST members provide

The RUC recommendation process from a pulmonologist’s perspective

“If there’s a change in a CPT code or there’s a new CPT code that we want to adopt, it starts at the CPT meeting,” explains Dr. Nicolacakis. “Our CPT and RUC teams work together to complete and submit a lengthy and detailed Code Change Application (CCA). We submit our proposal, and then it is presented at the CPT meeting. It’s kind of like going to Congress, honestly. Our CPT Advisors do their best to explain the procedure to the panel, answer questions and then wait to see if it is approved.”

If the code passes, it then goes to the AMA RUC committee to be surveyed for physician work. This is the point when the societies survey randomly selected members who are most likely to perform the specific medical service or procedure under review.

“We have a list of similar codes and procedures comparable to this new procedure,” says Dr. Nicolacakis. “From that list, respondents are asked to choose one that is similar enough in time and intensity to serve as a comparison. Then there are questions about the time, intensity, skill and risk to the patient compared with the reference they selected. Finally, they’re asked how much time the new procedure takes and what RVU they would assign to it.”

The RUC reviews the survey data and recommends an RVU value for the CPT code. Those recommendations are then sent to CMS. The committee meets three times each year, and the January meeting is the last one that can affect RVUs for the following calendar year. In the summer, CMS publishes its proposed rule, or Proposed Medicare Physician Fee Schedule in the Federal Register, outlining how services may be reimbursed nationwide the next year.

“After the proposed rule is released, the AMA and every professional society reviews it in their clinical practice committees,” says Dr. Nicolacakis. “We have committee calls to review the proposed rule and submit a comment letter back to CMS. CMS also reports on all the recommendations from the previous year’s RUC meetings.CMS may or may not accept all the recommendations from the RUC. The AMA and the RUC are advisory committees to CMS, but they don’t make the final determination; CMS does.”

Looking ahead

As technologies such as robotics, AI and precision diagnostics continue to reshape medicine, appropriate reimbursement for these services remains an important issue.

“With the medical landscape changing so rapidly, it’s important for us as clinicians to make sure we are being heard so our time and services are reflected appropriately,” says Dr. Nicolacakis.

“This is not a perfect process,” says Dr. Nicolacakis. “In fact, it’s very imperfect, but without participating, we won’t have any influence at all. If you have an interest in your particular area, every professional society has a committee you can get involved in. It’s not the sexy part of medicine, but in the end, it’s how we all get paid.”