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Physician payment reform--implementing resource-based relative value scales.

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|February 3, 1991

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New Medicare legislation phases out usual and customary physician fees, implementing a relative value scale system. This article provides guidance for physicians navigating these significant economic changes.

Area of Science:

Health Policy
Medical Economics
Physician Reimbursement

Background:

The traditional "usual and customary" (UCR) fee system for Medicare physician reimbursement is being phased out.
Recent legislative changes necessitate a transition to a new payment model.

Purpose of the Study:

To summarize recently enacted legislation impacting Medicare physician reimbursement.
To explain the implementation of a relative value scale (RVS) system.
To offer economic strategies for physicians facing these changes.

Main Methods:

Analysis of recently enacted legislation concerning Medicare physician reimbursement.
Explanation of the structure and implementation of relative value scales.
Development of recommendations for physicians.

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Main Results:

The traditional UCR fee system under Medicare will be phased out.
A new system based on relative value scales will be implemented for physician payments.
Physicians need to adapt to new reimbursement structures to ensure economic stability.

Conclusions:

Physicians must understand the implications of the shift from UCR to RVS for Medicare reimbursement.
Proactive planning and adaptation are crucial for physicians to manage economic impacts.
The transition to RVS represents a significant change in healthcare finance and physician practice management.