Relative value units and cost analysis, Part 3 of 4.

In recent years, the interest in relative value unit (RVU) cost analysis has been on the rise. Why all the excitement? RVU cost analysis places the knowledge, and therefore the power, in the hands of the administrator to negotiate revenues, analyze expenditures, and control costs. Cost analysis at the per (relative)-unit level allows for procedure profitability (or loss) analysis, setting internal fee schedules based on costs, contract negotiation based on RVU cost and utilization, equitable provider compensation packages based on productivity and overhead coverage, and tracking ancillary and referral utilization risks. In short, RVU cost accounting uses the Resource-Based Relative Value Scale (RBRVS) instead of stopwatches and clipboards when measuring clinical costs and activity.