To the Editor.
—The Commentary by Dr Hsiao et al1 in the April 1, 1992, issue that the resource-based relative value scale (RBRVS) is a fair and equitable way of paying physicians cannot be allowed to go unchallenged. The authors' assumptions that values for time of service, intensity of service, and overhead suffice to determine price of service do not withstand scientific scrutiny.A fair test of any hypothesis, including the RBRVS formula, is whether its conclusions are compatible with established fact. The Hsiao formula fails that test.Medicaid and health maintenance organizations (HMOs) both require providers of medical services to work at a discount. Any formula that fairly assigns prices for nondiscounted services, such as Medicare services, should come up with substantially higher fees than either Medicaid or HMOs offer. Yet many services are valued by Hsiao at below those discounted rates.See also p 3363.Perimetry and
Tennant JS. RBRVS Gets an Eye Test. JAMA. 1992;268(23):3313. doi:10.1001/jama.1992.03490230043012