Computation of Total Relative Value Units and Adjusted Variable Costs

Computation of Total Relative Value Units and Adjusted Variable Costs
The Total Relative Value Units (RVUs) refer to the reimbursement physicians will receive for their services to their insured clients from Medicare CITATION You07 \l 1033 (Yousem & Beauchamp, 2007). After conducting an initial analysis of the Physician Fee Schedule, the authors found the following results.
Table 1.
Results from Conducting an RVU and GPCI analysis. LINK Excel.Sheet.12 "Book1" "Sheet1!R10C6:R16C7" \a \f 5 \h \* MERGEFORMAT
Values


Work RVU

2.60

FIF PE RVU

2.13

MP RVU

0.17

GPCI Work

1.001

GPCI PE

1.047

GPCI MP

0.767

These results are essential for the subsequent step, which is calculating the total RVU by adding the values of (1) Work RVU x Work GCI, (2) Practice RVU x Practice GCI, and (3) Malpractice RVU x Malpractice GCI. Using the formulas, the Total RVU yielded an answer of 4.9631 units. After that, this was multiplied by the conversion factor of $34.89, which represents the amount that the physician should receive per visit CITATION CMS21 \l 1033 (CMS.Gov, 2021). This resulted in the amount of $173.16 per visit.
Table 2.
Calculation of Physician Reimbursement LINK Excel.Sheet.12 "Book1" "Sheet1!R10C6:R16C10" \a \f 5 \h \* MERGEFORMAT
Calculation

Result

Work RVU x Work GCI

2.6026

Practice RVU x Practice GCI

2.23011

Malpractice RVU x Malpractice GCI

0.13039

Total RVU