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HRD-92-38R 1 (1992-07-13)

handle is hein.gao/gaobackcb0001 and id is 1 raw text is: United States GAO General Accounting Office Washington, D.C. 20548 Human Resources Division B-24 9274 July 13, 1992 The Honorable William E. Dannemeyer 147047 Ranking Minority Member Subcommittee on Health and the Environment Committee on Energy and Commerce House of Representatives Dear Mr. Dannemeyer: Your letter of February 3, 1992, asked about the costs physicians might incur as a result of Medicare changing from the reasonable charge payment method to use of a resource based relative value scale (RBRVS) for physician services. You attached a copy of an article from the December 23/30, 1991, American Medical News that discussed potential costs to physicians of estimating the effect of the change to RBRVS on their gross revenues from Medicare. You asked us to estimate the total physician and administrative staff hours required for physicians to adjust to the RBRVS system, and the costs associated with such hours. Information on which to estimate the total staff time and related costs of physicians changing to RBRVS is not available. However, implementation of RBRVS will involve some administrative costs for physicians. Some of these costs, such as those related to learning how to use new procedure codes, are routine costs associated with any fee- for-service billing system. Other costs, such as estimating the effect on gross revenues, should be one-time costs and these will vary substantially among physicians. BACKGROUND ON MEDICARE AND RBRVS Medicare, authorized by title XVIII of the Social Security Act, is a health insurance program that covers most Americans age 65 or older and some disabled people. About 35.5 million people are expected to be covered by Medicare during 1992. Medicare consists of two parts. Part A covers inpatient hospital, skilled nursing, home health, and hospice services. Part B covers physician services and a broad range of other noninstitutional services, such as diagnostic laboratory GAO/HRD-92-38R, RBRVS and Administrative Costs

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