Resource-based relative value scale

Okay kiddo, so you know how sometimes when you go to the doctor or the hospital, you get a bill for how much you have to pay? Well, the government and insurance companies have a fancy way of deciding how much they are going to pay for those doctors and hospital visits.

They use what’s called a resource-based relative value scale, which is just a fancy way of saying they have a list of different medical procedures and how much they are worth in terms of time, labor, and materials.

So, let’s say a doctor has to spend an hour taking care of you and she has to do a bunch of different things like listen to your heart, make sure your lungs are working okay, and take your temperature. Each of those actions (or medical procedures) is worth a certain number of “points” on the resource-based relative value scale. The more complicated or time-consuming the procedure, the more points it is worth.

Then, someone (usually a computer) adds up all of the points for all of the procedures the doctor did during your visit, and that gives them a number that helps them figure out how much the doctor should be paid for her time and work.

That’s basically what a resource-based relative value scale is: a way for the government and insurance companies to decide how much to pay for medical procedures based on the amount of time, effort, and materials it takes to do them.