Relative value units (RVUs), used to calculate physician remuneration and incentives for services and procedures, are a component of physician pay that residents may want to become familiar with.
RVUs serve as an objective measure of procedures listed in the Current Procedural Terminology code set and reflect the time, intensity, and cost of care.
Physicians should compile and refer to a list of common RVUs used in their practice to maximize productivity. Office managers and medical coders may be helpful in compiling this list.
Relative value units (RVUs) are an important metric in determining how physicians are paid—so residents may want to learn about them.
Doctors should consider becoming familiar with the different kinds of RVUs and how they work during their residency to help optimize the pay and incentives they receive over the course of their careers.
What are RVUs?
RVUs are an objective measure of the cost components tied to services and procedures described in the Current Procedural Terminology (CPT) code set.
According to AMA research, CPT codes represent a standardized language for coding medical services and procedures that facilitates reporting, accuracy, and efficiency. They are also utilized for administrative purposes, such as claims processing and creating guidelines for medical care review.
RVUs allow healthcare professionals (HCPs) to consolidate the time, intensity, and cost of care into a single relative ranking scale, the Resource-Based Relative Value Scale (RBRVS), according to an article published by the AMA’s CPT International.
RVUs serve many purposes. They help measure physician/group productivity, utilization allocation, cost benchmarking, or other performance analytics representing the clinician, health system, or payer.
The RBVRS is rooted in the idea that physician payment for services should be directly dependent on the resource costs of providing the services. The goal is to bolster the payment system for doctors and to improve that system as procedures modernize.
Using the metrics
The American Academy for Professional Coders (AAPC) put these measures in perspective.
"Not all physician services represented by a [CPT] code or Healthcare Common Procedure Coding System (HCPCS) Level II code are created equal."
— The AAPC
“Some services require a considerable investment of physician time and effort, clinical staff, and specialized equipment. Other services require inappreciable time and resources,” the AAPC further explained.
As the AAPC further explains, “to implement a fee schedule built on the principle that payments for medical procedures and services should reflect the costs of providing them, CMS adopted the RBRVS, which calculates fees for each service and procedure based on a single measure—the relative value unit.”
In other words, RVUs for a specific procedure or service are relative to other procedures or services. For example, a service designated as six RVUs accounts for six times the resources of another procedure or service with a value of only one RVU.
RVUs measure three components: physician work, the expenses of the practice, and liability protection. They align with geographic index adjustments and a system-wide conversion factor to help ensure proper reimbursement, according to the AMA’s CPT International.
The geographic practice cost index (GPCI) is specific to each Medicare payment locality for the three components of a procedure’s RVU.
GPCIs are used to calculate a fee schedule amount, with the RVU for each component multiplied by the GPCI for that component.
CMS offers a searchable database of services covered by the Medicare fee schedule, which details over 10,000 physician services, applicable RVUs, a fee schedule status indicator, and different payment policy indicators used for payment adjustment (eg, surgery assists, team surgeries).
Application of RVUs
Identifying the RVU for each procedure can help physicians determine and compare resource utilization and productivity among individual physicians, groups of physicians, or departments, as well as compared with benchmarks.
To calculate work RVUs (wRVUs) linked to individuals or groups, the frequency of each CPT code billed during a set period of time is multiplied by the wRVU of each CPT code, which is adjusted for conversion factors to be in line with spending limits. The result helps assess physician productivity, performance, and variation—and can be used to support compensation policies.
Keeping tabs on RVUs
Most physicians receive incentive pay related to RVUs, so knowing RVUs for each service can boost productivity. Although the AAPC has a real-time online work RVU calculator, it’s a good idea to enlist the help of other HCPs when leveraging this information.
Writing for Family Practice Management, Megan Lykke, MD, recommended that “to ensure accuracy, ask your office manager or coder for the set of RVUs your practice follows.” 
"Having a reference that lists codes and RVUs for common office visits and procedures will help you quickly determine which ones are more productive."
— Megan Lykke, MD, Family Practice Management
Historically, physicians have had issues with various aspects of RVUs and CPTs. Decreased reimbursement in the case of multiple procedures (ie, multiple procedure payment reduction, or MPPR) can cause problems, as can the bundling of CPT codes. It has also been difficult to get CPT codes cleared for screening procedures.
For example, with an MPPR, Medicare and many commercial payers will only reimburse at full price for the highest-valued procedure, according to an article published by Current Problems in Diagnostic Radiology. As for bundling of codes, CMS justifies the reduced compensation by citing the overlap in time and services (ie, misvalued services), akin to an economy of scale.
A form of incentive pay
Although alternative payment models and value-based payment systems are on the rise, RVUs still represent incentive pay for the majority of physicians. As such, it’s important for licensed physicians and residents to familiarize themselves with a set of RVUs commonly used during practice.
It’s never too early to learn about these important pay metrics—even during training. When compiling a list of RVUs, office managers and medical coders serve as valuable resources.
What this means for you
As RVUs are a form of incentive pay for physicians, residents should become familiar with the ones most commonly used prior to getting their medical license. This knowledge will be extremely useful in ensuring your highest-possible compensation over the course of your career in medicine.