Impact of 2021 RVUs On Pediatricians

Every year, I try to analyze the impact of the RVU changes on pediatricians. Why? Because what the Feds do in the Nov/Dec/Jan cycle each has a profound, downstream effect on pediatricians.  Going through this process is also how I figured out what was happening with immunization administration codes in 2018 and helps me counsel many practices working on fee schedule offers from the payers.

This year is even more challenging.  First...COVID.  Pediatricians are struggling to stay open right now.  Second, we're also struggling to make sense of the new E&M rules but we really can't do it outside the context of what the financial implication is.  Does it matter if my 99214s are down 20% if their payments increase 15%?   Maybe, we'll find out.

The results going back the last 3 years have not been good for pediatricians, but we have good news this year. Here's what 2020 looked like, here's 2019.  Since 2018, RVUs and/or the Medicare multiplier have slowly eroded for pediatricians after a long, general run of improvement.  

A review of my methodology:

• I start by grabbing the full CPT utilization of our customers and determine which RVU-valid codes (i.e., codes with RVU values) have real impact on pediatric revenue. In 2021, that amounts to just under 250 CPT codes that make up 99%+ of pediatric revenue. Our sample crossed the billion dollar threshold a few years back, so it's a decent data set.
  
  
• Using mildly proprietary math, I distribute those codes based on what I'd consider to be the most typical FTE arrangement. In other words, imagine a pediatrician with about 4000 visits a year - how many 99213s would that be, how many screenings, etc.? Every practice and every pediatrician is different, of course, but it is helpful to have a baseline from which to predict.  N.B.: the sick:well ratio for 2020 was 30% lower in than 2019 so the overall E&M volume is likely to underestimated if sick visits return to normal.
  
  
• I then plug in the 2020 RVU data, using a neutral GPCI, and compare it to the 2021 data. Which codes change the most - and which codes, by virtue of their pediatric volume - have the biggest impact? Where do we land?

The results for 2021?

• Headline: I estimate that 2021 will increase pediatric RVUs by about 12% and RVU-based payments by 8.5%.  That is huge, frankly.  Why don't those numbers match? Because the Medicare Conversion Factor (what the Feds pay for each RVU) changed, too. Don't forget to adjust by your GPCI!  
  
  
• To put this in perspective, the implication is that an FTE pediatrician would see an increase of about $50,000 in revenue in 2021 using 2020's volume and 2021's RVU values.  Note, that's not how this works, but it's an encouraging result!
  
  
• Again, note: the 2020 E&M volume was significantly lower than 2019.  Although we are beginning slowly at this point, if sick visit volumes return to a more typical level, the positive financial impact will be significant.
  
  
• As I noted last year:
  

  For the 3rd year in a row, the key elements of preventive care - the most important work that pediatricians do and the obvious place where our economy and culture need to invest - have been cut significantly. Imms admins (90460-1, 90471-3), health risk assessments (96160, 96161), and behavioral/emotional screening (96127) have taken double-digit hits. The 90460 dropped by 15% this year and was supposed to drop more, I believe, before the AAP intervened.You'd think the state of immunization-preventable disease outbreaks would move the needle in the other direction.

  The tide has turned.  Not entirely, not quite the way we'd hope, but significantly so.  In an effort to move more money into primary care, the Feds pushed a lot of RVUs into the E&Ms.  So much so, they had to lower the rates for everything else!

  There's more: the AAP's work to restore the imms admin values was partially successful and the values were returned to 2019 levels (better than 2020!).  

• Some other things happened.  A GIGANTIC increase to RVUs for "audio only visits" - or phone calls.  You barely use them, but this is a very interesting development.
  
  
• The 96160/1 combo (health risk assessments) got a nice boost, too.  You should be doing post-partum screening on your parents, this is a good reminder.

The bottom line?  Practices working on their insurance contracts should heartily avoid RBRVS-based contracts based in years 2018-2020.  2021 looks good. 

Below is a chart of some select CPT codes and the differences.