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CMS-1403-FC 32 PFS final rule published November 2, 1999 (64 FR 59380). The MP RVUs were based on malpractice insurance premium data collected from commercial and physician-owned insurers from all the States, the District of Columbia, and Puerto Rico. 4. Refinements to the RVUs Section 1848(c)(2)(B)(i) of the Act requires that we review all RVUs no less often than every 5 years. The first 5-Year Review of the physician work RVUs was published on November 22, 1996 (61 FR 59489) and was effective in 1997. The second 5-Year Review was published in the CY 2002 PFS final rule with comment period (66 FR 55246) and was effective in 2002. The third 5-Year Review of physician work RVUs was published in the CY 2007 PFS final rule with comment period (71 FR 69624) and was effective on January 1, 2007. (Note: Additional codes relating to the third 5-Year Review of physician work RVUs were addressed in the CY 2008 PFS final rule with comment period (72 FR 66360).) In 1999, the AMA’s RUC established the Practice Expense Advisory Committee (PEAC) for the purpose of refining the direct PE inputs. Through March 2004, the PEAC provided recommendations to CMS for over 7,600 codes (all but a few hundred of the codes currently listed in the

CMS-1403-FC 33 AMA's Current Procedural Terminology (CPT) codes). As part of the CY 2007 PFS final rule with comment period (71 FR 69624), we implemented a new methodology for determining resource-based PE RVUs and are transitioning this over a 4-year period. In the CY 2005 PFS final rule with comment period (69 FR 66236), we implemented the first 5-Year Review of the MP RVUs (69 FR 66263). 5. Adjustments to RVUs are Budget Neutral Section 1848(c)(2)(B)(ii)(II) of the Act provides that adjustments in RVUs for a year may not cause total PFS payments to differ by more than $20 million from what they would have been if the adjustments were not made. In accordance with section 1848(c)(2)(B)(ii)(II) of the Act, if adjustments to RVUs cause expenditures to change by more than $20 million, we make adjustments to ensure that expenditures do not increase or decrease by more than $20 million. As explained in the CY 2007 PFS final rule with comment period (71 FR 69624), due to the increase in work RVUs resulting from the third 5-Year Review of physician work RVUs, we applied a separate budget neutrality (BN) adjustor to the work RVUs for services furnished during 2007 and 2008. This approach is consistent with the method

<strong>CMS</strong>-1403-FC 33<br />

AMA's Current Procedural Terminology (CPT) codes). As part<br />

of the CY 2007 PFS final rule with comment period<br />

(71 FR 69624), we implemented a new methodology for<br />

determining resource-based PE RVUs and are transitioning<br />

this over a 4-year period.<br />

In the CY 2005 PFS final rule with comment period<br />

(69 FR 66236), we implemented the first 5-Year Review of<br />

the MP RVUs (69 FR 66263).<br />

5. Adjustments to RVUs are Budget Neutral<br />

Section 1848(c)(2)(B)(ii)(II) of the Act provides that<br />

adjustments in RVUs for a year may not cause total PFS<br />

payments to differ by more than $20 million from what they<br />

would have <strong>been</strong> if the adjustments were not made. In<br />

accordance with section 1848(c)(2)(B)(ii)(II) of the Act,<br />

if adjustments to RVUs cause expenditures to change by more<br />

than $20 million, we make adjustments to ensure that<br />

expenditures do not increase or decrease by more than<br />

$20 million.<br />

As explained in the CY 2007 PFS final rule with<br />

comment period (71 FR 69624), due to the increase in work<br />

RVUs resulting from the third 5-Year Review of physician<br />

work RVUs, we applied a separate budget neutrality (BN)<br />

adjustor to the work RVUs for services furnished during<br />

2007 and 2008. <strong>This</strong> approach is consistent with the method

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