Practice Expense and Its Impact on Radiology Reimbursement

Practice expense (PE) is one of three components that contribute to total relative value units (RVUs). Across the Medicare Physician Fee Schedule, PE accounts for nearly half of total RVUs. In radiology, however, this number is even higher, largely because of the nature and particularities of the specialty. This makes radiology especially sensitive to changes and updates in the inputs, methodology, and pricing used to calculate PE. In this review, the authors explore the Resource-Based Relative Value Scale RVU system with an emphasis on PE, its direct and indirect components, and its impact on radiology reimbursement. The authors explore how calculation methodologies as well as budget-neutrality adjustment mechanisms have the potential to significantly affect radiology reimbursement and provide practical considerations.