We have frequently discussed how perverse incentives are spread around health care. In the US, the physicians are paid according to a system that provides strong incentives for doing procedures, (see our posts about how the RUC has encouraged this bias towards procedures.) Since physicians are the most influential "deciders" about the care of individual patients, these incentives encourage overtesting and overtreatment with the highest technology, driving up costs and subjecting patients to increased risks of adverse events. The recent health care reform law, however, essentially encouraged a version of capitated payment, which might very well provide incentives for undertreatment and undertesting. For years, Dr Robert Centor has argued logically and forcefully for paying physicians for the time they spend on behalf of payments, very analogous to how lawyers and many other professionals are paid. This might provide much more neutral, less perverse incentives than would existing or other proposed physician payment schemes. Dr Centor argued again for this seemingly reasonable and logical idea on his DB's Medical Rants blog. The big question is why this idea has been so anechoic?
Showing posts with label RUC. Show all posts
Showing posts with label RUC. Show all posts
RUCing About - Conflicts of Interest Affecting the Members of the RBRVS Update Committee
Since 2007, we have been writing about the secretive RUC (RBRVS Update Committee), the private AMA committee that somehow has managed to get effective control over how Medicare pays physicians. The RUC has been accused of setting up incentives that strongly favor invasive, high technology procedures while disfavoring primary care and other "cognitive medicine." Despite the central role of (perverse) incentives in raising health care costs while limiting access and degrading quality, there was surprisingly little discussion about the pivotal role played by the RUC until the formation of the "Replace the RUC" movement (see post here).
Recently, the leaders of Replace the RUC scored a journalistic coup by putting the current list of RUC members publicly on-line. As we have discussed, previously the membership of this committee was kept very obscure, although the committee argued it was not exactly secret.
Some Google searching suggests one possible reason that the RUC was in no hurry to disclose its own membership. It appears that many of the RUC members have significant conflicts of interest with respect to their roles as de facto setters of the rates at which physicians are paid by the government.
The RUC Members and Their Financial Relationships
Below is the list of the current RUC membership (from this link), and relevant conflicts of interest obtained by Google searching. Note that for each member, I first give the name, affiliation relevant to the RUC, location, and first year of membership as provided by the link above. Then I list relevant financial relationships that appear to present conflicts of interest.
- Barbara Levy, MD
Chair, RVS Update Committee
Federal Way, WA 2000
Consultant/Advisory Boards: Conceptus; AMS; Covidien; Halt Medical; Gynesonics; Idoman Medical (hysteroscopic surgery and sterilization, endometrial ablation, electrosurgery, vaginal hysterectomy) per UptoDate
- Bibb Allen, Jr., MD
American College of Radiology (ACR)
Birmingham, AL 2006
- Michael D. Bishop, MD
American College of Emergency Physicians (ACEP)
Bloomington, IN 2003
- James Blankenship, MD
American College of Cardiology (ACC)
Danville, PA 2000
Lecture fees from Sanofi-Aventis per New England Journal of Medicine
- Robert Dale Blasier, MD
American Academy of Orthopaedic Surgeons (AAOS)
Little Rock, AK 2008
- Joel Bradley, MD
American Academy of Pediatrics (AAP)
Brentwood, TN 2008
Medical Director, Americhoice by UnitedHealthcare, per AAP conference brochure
- Ronald Burd, MD
American Psychiatric Association (APA)
Fargo, ND 2006
- William F. Gee, MD
American Urological Association (AUA)
Lexington, KY 2010
Member, Physician Advisory Board, Aetna per Aetna
- John O. Gage, MD
American College of Surgeons (ACS)
Pensacola, FL 1991
- David F. Hitzeman, DO
American Osteopathic Association (AOA)
Tulsa, OK 1996
- Peter A. Hollmann, MD
CPT Editorial Panel (AMA/CPT)
Providence, RI 2003
Medical Director, Blue Cross and Blue Shield of Rhode Island, per RI Medical Society
- Charles F. Koopmann, Jr., MD
American Academy of Otolaryngology-Head and Neck Surgery (AAO-HNS)
Ann Arbor, MI 1996
- Robert Kossmann, MD
Renal Physicians Association (RPA)
Santa Fe, NM 2009
Member of Advanced Renal Technologies Advisory Board, Network 15 Medical Advisory Board, Baxter Home Dialysis Advisory Board, Fresenius Medical Advisory Board per Renal Physicians Association
- Walter Larimore, MD
American Academy of Family Physicians (AAFP)
Colorado Springs, CO 2009
- Brenda Lewis, DO
American Society of Anesthesiologists (ASA)
Cleveland, OH 2009
- J. Leonard Lichtenfeld, MD
American College of Physicians (ACP)
Atlanta, GA 1994
Member, Physician Advisory Board, Aetna per Aetna
- Scott Manaker, MD, PhD
American College of Chest Physicians (ACCP)
Philadelphia, PA 2010
Consultant to Pfizer and Johnson and Johnson. Owns stock in Neose Technologies, Pfizer, Johnson & Johnson, and Rohm and Haas per Chest
- Bill Moran, MD
Practice Expense Review Committee
Oklahoma City, OK 2000
- Guy Orangio, MD
American Society of Colon & Rectal Surgeons (ASCRS)
Atlanta, GA 2009
- Gregory Przybylski, MD
American Association of Neurological Surgeons (AANS)
Edison, NJ 2001
Stock Ownership: United Healthcare (300 shares); ... Scientific Advisory Board: United Health Group (B, Spine Advisory Board) per NASS meeting
- Marc Raphaelson, MD
American Academy of Neurology (AAN)
Leesburg, VA 2009
personal compensation for activities with Jazz Pharmaceuticals and Medtronics as a speakers bureau member or consultant per AAN
- Sandra Reed, MD
American College of Obstetricians and Gynecologists (ACOG)
Thomasville, GA 2009
GlaxoSmithKline Consulting, $1750 in 2009, $1500 in 2010 per ProPublica Dollars for Docs search through here
- Daniel Mark Siegel, MD
American Academy of Dermatology (AAD)
Brooklyn, NY 2003
Vivacare Dermatology Advisory Board, 2006 – present. Photomedex Scientific Advisory Board, 2006-present, Ad Hoc consultant to ClickDiagnostics, per Encite CV
DermFirst-Shareholder, Logical Image – Consultant, Vivacare - Consultant per MOHS Surgery
- Lloyd S. Smith, DPM
Health Care Professionals Advisory Committee
Bethesda, MD 2007
- Peter Smith, MD
Society of Thoracic Surgeons (STS)
Durham, NC 2006
Eli Lilly, Consulting, $1500 in 2009, $1990 in 2010 per Pro Publica Dollars for Docs search through here
Advisor or consultant to Bayer per Medscape
- Susan Spires, MD
College of American Pathologists (CAP)
Lexington, KY 2007
- Arthur Traugott, MD
American Medical Association (AMA)
Champaign, IL 2006
- James Waldorf, MD
American Society of Plastic Surgeons (ASPS)
Jacksonville, FL 2008
- George Williams, MD
American Academy of Ophthalmology (AAO)
Royal Oak, MI 2009
Advisory Team, RetroSense Therapeutics
Shareholder and consultant for ThromboGenics Ltd. and holds intellectual property on the use of plasmin per Review of Opthamology
Alcon Laboratories, consultant, lecturer; Allergan, consultant, lecturer; Macusight, consultant, equity owner; Neurotech, consultant; Nu-Vue Technologies, equity owner, patent/ royalties; OMIC- Ophthalmic Mutual Insurance Company, employee; Optimedica, consultant, equity owner; Thrombogenics, consultant, equity owner per AAO meeting
Pfizer, “Professional Advising,” $5534 in 2009 per Pro Publica Dollars for Docs search through here
Summary
There you have it. A substantial proportion, almost half, 14 of 29 members of the RUC have financial relationships with pharmaceutical companies, biotechnology companies, device companies, companies that directly provide health care, and health care insurance companies.
As we have noted in our previous discussions of the RUC, that committee has been accused of being the de facto controller of how the US government pays physicians. In that role, it has been accused of favoring procedural care rather than cognitive or primary care by increasing the relative financial incentives for the former over the latter. This may be one of the most important reasons for the expensive, high-technology, procedural-heavy style of care in the US, which has likely been a major driver for increasing costs, declining access and stagnant quality.
It seemed obvious that a committee dominated by a majority of physicians who perform procedures would tend to favor bigger financial incentives for procedures. But now it appears the committee also includes a substantial number of people who work part-time or have ownership interests in companies that also stand to benefit from increasing use of procedures. Procedures drive increased consumption of drugs, supplies and devices, and lead to larger revenue for hospitals and clinics. Thus these financial relationships could reasonably be suspected of even further distorting the committee's decision-making in favor of procedures.
I was surprised how many RUC members have financial ties to health care insurance companies. Such companies are not usually thought of as beneficiaries of high-technology, procedural care. However, if one conceives of their revenue as a percentage of health care costs, perhaps they are. Furthermore, one can only wonder if the links between the RUC and health care insurance companies have anything to do with how such companies have apparently unquestioningly adapted the RBRVS system controlled by the RUC?
The prevalence of conflicts of interest among RUC members highlight the need for a more accountable, transparent and honest system to manage how the government pays physicians, and a need for more transparency and accountability in the relationship among the government, health care insurance, and physicians.
As we have previously noted, there are still many unanswered questions about the RUC:
- How did the government come to fix the payments physicians receive? Government price-fixing has not been popular in the US, yet this has caused no outcry.
- Why is the process by which they are fixed allowed to be so opaque and unaccountable? Why are there no public hearings on the updates, and why is there no input from practicing physicians or organizations other than those related to the RUC?
- How did the RUC become de facto in charge of this process?
- Why does the AMA [keep the membership of the RUC so opaque, and] give no input into the RUC process to its general membership?
- Why is the RUC membership so dominated by procedural specialists? Why were primary care physicians, who made up at least a sizable minority of physicians when the update process was started, not represented according to their numbers?
- Why has there been so little discussion of the RUC and its responsibility for an extremely expensive health care system dominated by high-technology, expensive, risky and invasive procedures?
Stay tuned, maybe these will be answered in our life-times....
Recently, the leaders of Replace the RUC scored a journalistic coup by putting the current list of RUC members publicly on-line. As we have discussed, previously the membership of this committee was kept very obscure, although the committee argued it was not exactly secret.
Some Google searching suggests one possible reason that the RUC was in no hurry to disclose its own membership. It appears that many of the RUC members have significant conflicts of interest with respect to their roles as de facto setters of the rates at which physicians are paid by the government.
The RUC Members and Their Financial Relationships
Below is the list of the current RUC membership (from this link), and relevant conflicts of interest obtained by Google searching. Note that for each member, I first give the name, affiliation relevant to the RUC, location, and first year of membership as provided by the link above. Then I list relevant financial relationships that appear to present conflicts of interest.
- Barbara Levy, MD
Chair, RVS Update Committee
Federal Way, WA 2000
Consultant/Advisory Boards: Conceptus; AMS; Covidien; Halt Medical; Gynesonics; Idoman Medical (hysteroscopic surgery and sterilization, endometrial ablation, electrosurgery, vaginal hysterectomy) per UptoDate
- Bibb Allen, Jr., MD
American College of Radiology (ACR)
Birmingham, AL 2006
- Michael D. Bishop, MD
American College of Emergency Physicians (ACEP)
Bloomington, IN 2003
- James Blankenship, MD
American College of Cardiology (ACC)
Danville, PA 2000
Lecture fees from Sanofi-Aventis per New England Journal of Medicine
- Robert Dale Blasier, MD
American Academy of Orthopaedic Surgeons (AAOS)
Little Rock, AK 2008
- Joel Bradley, MD
American Academy of Pediatrics (AAP)
Brentwood, TN 2008
Medical Director, Americhoice by UnitedHealthcare, per AAP conference brochure
- Ronald Burd, MD
American Psychiatric Association (APA)
Fargo, ND 2006
- William F. Gee, MD
American Urological Association (AUA)
Lexington, KY 2010
Member, Physician Advisory Board, Aetna per Aetna
- John O. Gage, MD
American College of Surgeons (ACS)
Pensacola, FL 1991
- David F. Hitzeman, DO
American Osteopathic Association (AOA)
Tulsa, OK 1996
- Peter A. Hollmann, MD
CPT Editorial Panel (AMA/CPT)
Providence, RI 2003
Medical Director, Blue Cross and Blue Shield of Rhode Island, per RI Medical Society
- Charles F. Koopmann, Jr., MD
American Academy of Otolaryngology-Head and Neck Surgery (AAO-HNS)
Ann Arbor, MI 1996
- Robert Kossmann, MD
Renal Physicians Association (RPA)
Santa Fe, NM 2009
Member of Advanced Renal Technologies Advisory Board, Network 15 Medical Advisory Board, Baxter Home Dialysis Advisory Board, Fresenius Medical Advisory Board per Renal Physicians Association
- Walter Larimore, MD
American Academy of Family Physicians (AAFP)
Colorado Springs, CO 2009
- Brenda Lewis, DO
American Society of Anesthesiologists (ASA)
Cleveland, OH 2009
- J. Leonard Lichtenfeld, MD
American College of Physicians (ACP)
Atlanta, GA 1994
Member, Physician Advisory Board, Aetna per Aetna
- Scott Manaker, MD, PhD
American College of Chest Physicians (ACCP)
Philadelphia, PA 2010
Consultant to Pfizer and Johnson and Johnson. Owns stock in Neose Technologies, Pfizer, Johnson & Johnson, and Rohm and Haas per Chest
- Bill Moran, MD
Practice Expense Review Committee
Oklahoma City, OK 2000
- Guy Orangio, MD
American Society of Colon & Rectal Surgeons (ASCRS)
Atlanta, GA 2009
- Gregory Przybylski, MD
American Association of Neurological Surgeons (AANS)
Edison, NJ 2001
Stock Ownership: United Healthcare (300 shares); ... Scientific Advisory Board: United Health Group (B, Spine Advisory Board) per NASS meeting
- Marc Raphaelson, MD
American Academy of Neurology (AAN)
Leesburg, VA 2009
personal compensation for activities with Jazz Pharmaceuticals and Medtronics as a speakers bureau member or consultant per AAN
- Sandra Reed, MD
American College of Obstetricians and Gynecologists (ACOG)
Thomasville, GA 2009
GlaxoSmithKline Consulting, $1750 in 2009, $1500 in 2010 per ProPublica Dollars for Docs search through here
- Daniel Mark Siegel, MD
American Academy of Dermatology (AAD)
Brooklyn, NY 2003
Vivacare Dermatology Advisory Board, 2006 – present. Photomedex Scientific Advisory Board, 2006-present, Ad Hoc consultant to ClickDiagnostics, per Encite CV
DermFirst-Shareholder, Logical Image – Consultant, Vivacare - Consultant per MOHS Surgery
- Lloyd S. Smith, DPM
Health Care Professionals Advisory Committee
Bethesda, MD 2007
- Peter Smith, MD
Society of Thoracic Surgeons (STS)
Durham, NC 2006
Eli Lilly, Consulting, $1500 in 2009, $1990 in 2010 per Pro Publica Dollars for Docs search through here
Advisor or consultant to Bayer per Medscape
- Susan Spires, MD
College of American Pathologists (CAP)
Lexington, KY 2007
- Arthur Traugott, MD
American Medical Association (AMA)
Champaign, IL 2006
- James Waldorf, MD
American Society of Plastic Surgeons (ASPS)
Jacksonville, FL 2008
- George Williams, MD
American Academy of Ophthalmology (AAO)
Royal Oak, MI 2009
Advisory Team, RetroSense Therapeutics
Shareholder and consultant for ThromboGenics Ltd. and holds intellectual property on the use of plasmin per Review of Opthamology
Alcon Laboratories, consultant, lecturer; Allergan, consultant, lecturer; Macusight, consultant, equity owner; Neurotech, consultant; Nu-Vue Technologies, equity owner, patent/ royalties; OMIC- Ophthalmic Mutual Insurance Company, employee; Optimedica, consultant, equity owner; Thrombogenics, consultant, equity owner per AAO meeting
Pfizer, “Professional Advising,” $5534 in 2009 per Pro Publica Dollars for Docs search through here
Summary
There you have it. A substantial proportion, almost half, 14 of 29 members of the RUC have financial relationships with pharmaceutical companies, biotechnology companies, device companies, companies that directly provide health care, and health care insurance companies.
As we have noted in our previous discussions of the RUC, that committee has been accused of being the de facto controller of how the US government pays physicians. In that role, it has been accused of favoring procedural care rather than cognitive or primary care by increasing the relative financial incentives for the former over the latter. This may be one of the most important reasons for the expensive, high-technology, procedural-heavy style of care in the US, which has likely been a major driver for increasing costs, declining access and stagnant quality.
It seemed obvious that a committee dominated by a majority of physicians who perform procedures would tend to favor bigger financial incentives for procedures. But now it appears the committee also includes a substantial number of people who work part-time or have ownership interests in companies that also stand to benefit from increasing use of procedures. Procedures drive increased consumption of drugs, supplies and devices, and lead to larger revenue for hospitals and clinics. Thus these financial relationships could reasonably be suspected of even further distorting the committee's decision-making in favor of procedures.
I was surprised how many RUC members have financial ties to health care insurance companies. Such companies are not usually thought of as beneficiaries of high-technology, procedural care. However, if one conceives of their revenue as a percentage of health care costs, perhaps they are. Furthermore, one can only wonder if the links between the RUC and health care insurance companies have anything to do with how such companies have apparently unquestioningly adapted the RBRVS system controlled by the RUC?
The prevalence of conflicts of interest among RUC members highlight the need for a more accountable, transparent and honest system to manage how the government pays physicians, and a need for more transparency and accountability in the relationship among the government, health care insurance, and physicians.
As we have previously noted, there are still many unanswered questions about the RUC:
- How did the government come to fix the payments physicians receive? Government price-fixing has not been popular in the US, yet this has caused no outcry.
- Why is the process by which they are fixed allowed to be so opaque and unaccountable? Why are there no public hearings on the updates, and why is there no input from practicing physicians or organizations other than those related to the RUC?
- How did the RUC become de facto in charge of this process?
- Why does the AMA [keep the membership of the RUC so opaque, and] give no input into the RUC process to its general membership?
- Why is the RUC membership so dominated by procedural specialists? Why were primary care physicians, who made up at least a sizable minority of physicians when the update process was started, not represented according to their numbers?
- Why has there been so little discussion of the RUC and its responsibility for an extremely expensive health care system dominated by high-technology, expensive, risky and invasive procedures?
Stay tuned, maybe these will be answered in our life-times....
BLOGSCAN: Circling the Wagons Around the RUC
On the Care and Cost Blog, Brian Klepper suggested that the defenders of the RUC (RBRVS Update Committee) are getting worried. He showed that a letter signed by medical specialty societies, but not the major societies that represent generalists, deployed logical fallacies in support of the secretive committee dominated by proceduralists that de facto sets payments to physicians by the US Medicare system, and which seems largely responsible for the gulf between payments for procedures and for primary and "cognitive" care. His summation:
The arguments mounted by the AMA and the specialty societies are really nothing more than a vested industry’s efforts to preserve the status quo at all costs. (Think Wall Street’s apologists in this year’s Oscar-winning documentary, Inside Job.) But this approach has brought health care and the US economy to the brink of economic catastrophe.
Averting disaster will require an approach that dampens or bypasses the voices of the advisors who got us here, and strengthens the voice of primary care, which overwhelming data show produce better care at lower costs.
Getting Out of Our RUC - "An Open Letter To Primary Care Physicians"
Since 2007, we have been writing about the secretive RUC (RBRVS Update Committee), the private AMA committee that somehow has managed to get effective control over how Medicare pays physicians. The RUC has been accused of setting up incentives that strongly favor invasive, high technology procedures while disfavoring primary care and other "cognitive medicine." Despite the central role of (perverse) incentives in raising health care costs while limiting access and degrading quality, there has been surprisingly little discussion about the pivotal role played by the RUC.
Now there is a movement afoot to replace the RUC. In a new post on the Care and Cost blog, and the Replace the RUC site, Paul M. Fischer and Brian Klepper urged four approaches:
1. Make the public aware of the RUC’s role and urge the primary care societies to stop “enabling” the RUC through their participation.
2. Recruit experts who can credibly calculate the economic impacts of the RUC’s actions, and who can devise alternative payment methodologies.
3. Demonstrate the unlawfulness of CMS’ (and HCFA’s) two-decades long reliance on the RUC.
4. Develop a collaboration between primary care and non-health care business.
They are also urging three specific actions:
They have set up an electronic petition that people can use to urge the three major medical societies that represent primary care physicians to quit the RUC.
On Health Care Renewal, we have been trying to make the systemic problems with with the leadership of health care organizations less anechoic in the hopes that greater realization that these problems exist would lead to actions to solve them. The regulatory capture by the RUC of Medicare's payment setting mechanism is one problem that really cries out for a solution. In 2007, I called for "an unbiased re-evaluation of the components of the RBRVS by people who are dedicated to doing it fairly, not benefiting one group of physicians, or the organizations that benefit from the increased use of procedures"; and "an unbiased investigation of what went awry with the process used by Medicare to determine physician payments." Your heard it here first on Health Care Renewal. It is nice to now have such distinguished company.
I urge our readers to consider the actions urged above.
True health care reform will require a transparent, honest, fair process for governments to decide on how they will pay for physicians' care and other health care services and goods.
Now there is a movement afoot to replace the RUC. In a new post on the Care and Cost blog, and the Replace the RUC site, Paul M. Fischer and Brian Klepper urged four approaches:
1. Make the public aware of the RUC’s role and urge the primary care societies to stop “enabling” the RUC through their participation.
2. Recruit experts who can credibly calculate the economic impacts of the RUC’s actions, and who can devise alternative payment methodologies.
3. Demonstrate the unlawfulness of CMS’ (and HCFA’s) two-decades long reliance on the RUC.
4. Develop a collaboration between primary care and non-health care business.
They are also urging three specific actions:
1. Contact your primary care society to demand that they withdraw from the RUC.
2. Broaden awareness of what we’re doing and why by rebroadcasting to your primary care colleagues.
3. Get in touch to help us with resources, relationships or approaches that can strengthen this project.
They have set up an electronic petition that people can use to urge the three major medical societies that represent primary care physicians to quit the RUC.
On Health Care Renewal, we have been trying to make the systemic problems with with the leadership of health care organizations less anechoic in the hopes that greater realization that these problems exist would lead to actions to solve them. The regulatory capture by the RUC of Medicare's payment setting mechanism is one problem that really cries out for a solution. In 2007, I called for "an unbiased re-evaluation of the components of the RBRVS by people who are dedicated to doing it fairly, not benefiting one group of physicians, or the organizations that benefit from the increased use of procedures"; and "an unbiased investigation of what went awry with the process used by Medicare to determine physician payments." Your heard it here first on Health Care Renewal. It is nice to now have such distinguished company.
I urge our readers to consider the actions urged above.
True health care reform will require a transparent, honest, fair process for governments to decide on how they will pay for physicians' care and other health care services and goods.
"Replace the RUC!"
We have frequently posted, first here in 2007, and more recently here and here, about the little-known group that controls how the US Medicare system pays physicians, the RBRVS Update Committee, or RUC.
Since 1991, Medicare has set physicians' payments using the Resource Based Relative Value System (RBRVS), ostensibly based on a rational formula to tie physicians' pay to the time and effort they expend, and the resources they consume on particular patient care activities. Although the RBRVS was meant to level the payment playing field for cognitive services, including primary care vs procedures, over time it has had the opposite effect, as explained by Bodenheimer et al in a 1997 article in the Annals of Internal Medicine.(1) A system that pays a lot for procedures, but much less for diagnosing illnesses, forecasting prognoses, deciding on treatment, and understanding patients' values and preferences when procedures and devices are not involved, is likely to be very expensive, but not necessarily very good for patients.
As we wrote before, to update the system, the Center for Medicare and Medicaid Services (CMS) relies almost exclusively on the advice of the RBRVS Update Committee. The RUC is a private committee of the AMA, touted as an "expert panel" that takes advantage of the organization's First Amendment rights to petition the government. Membership on the RUC is allotted to represent specialty societies, so that the vast majority of the members represent specialties that do procedures and focus on expensive, high-technology tests and treatments. However, the identities of RUC members are opaque, and the proceedings of the group are secret.
To expand on the penultimate point, the current page on the AMA web-site that describes the RUC only lists its members in terms of their specialties and organizational affiliation. Their names do not appear. A response to a previous post by me on the subject by the then Chair and Chair-Elect of the RUC suggested that the RUC membership is not quite secret. They stated that "a list of the individual members of the RUC is published in the AMA publication, Medicare RBRVS 2009: The Physicians Guide." This publication is available from the AMA here for a mere $71.95 (although now with the notation that the product has been "discontinued.") However, the book is not on the web, or in my local or university library, and I have no other way to easily access it. Thus, the RUC membership is at best relatively opaque.
To expand on the ultimate point, as Goodson(2) noted, RUC "meetings are closed to outside observers except by invitation of the chair." Furthermore, he stated, "proceedings are proprietary and therefore not publicly available for review."
The fog surrounding the operations of the RUC seems to have affected many who write about it. We have posted (here, here, here, and here) about how previous publications about problems with incentives provided to physicians seemed to have avoided even mentioning the RUC. Up until 2010, after the US recent attempt at health care reform, the RUC seemed to remain the great unmentionable. Even the leading US medical journal seemed reluctant to even print its name.
That changed in October, 2010. A combined effort by the Wall Street Journal, the Center for Public Integrity, and Kaiser Health News yielded two major articles about the RUC, here in the WSJ (also with two more spin-off articles), and here from the Center for Public Integrity (also reprinted by Kaiser Health News.) The articles covered the main points about the RUC: its de facto control over how physicians are paid, its "secretive" nature (quoting the WSJ article), how it appears to favor procedures over cognitive physician services, etc.
So the RUC became less anechoic. Now, four months later, there is more news. A new site called "Replace the RUC!" has now appeared, with the following introduction:
We have previously noted that there are many unanswered questions about the RUC:
Note that "Replace the RUC!" will be added to our link list.
References
1. Bodenheimer T, Berenson RA, Rudolf P. The primary care-specialty income gap: why it matters. Ann Intern Med 2007; 146: 301-306. (Link here.)
2. Goodson JD. Unintended consequences of Resource-Based Relative Value Scale reimbursement. JAMA 2007; 298(19):2308-2310. (Link here.)
Since 1991, Medicare has set physicians' payments using the Resource Based Relative Value System (RBRVS), ostensibly based on a rational formula to tie physicians' pay to the time and effort they expend, and the resources they consume on particular patient care activities. Although the RBRVS was meant to level the payment playing field for cognitive services, including primary care vs procedures, over time it has had the opposite effect, as explained by Bodenheimer et al in a 1997 article in the Annals of Internal Medicine.(1) A system that pays a lot for procedures, but much less for diagnosing illnesses, forecasting prognoses, deciding on treatment, and understanding patients' values and preferences when procedures and devices are not involved, is likely to be very expensive, but not necessarily very good for patients.
As we wrote before, to update the system, the Center for Medicare and Medicaid Services (CMS) relies almost exclusively on the advice of the RBRVS Update Committee. The RUC is a private committee of the AMA, touted as an "expert panel" that takes advantage of the organization's First Amendment rights to petition the government. Membership on the RUC is allotted to represent specialty societies, so that the vast majority of the members represent specialties that do procedures and focus on expensive, high-technology tests and treatments. However, the identities of RUC members are opaque, and the proceedings of the group are secret.
To expand on the penultimate point, the current page on the AMA web-site that describes the RUC only lists its members in terms of their specialties and organizational affiliation. Their names do not appear. A response to a previous post by me on the subject by the then Chair and Chair-Elect of the RUC suggested that the RUC membership is not quite secret. They stated that "a list of the individual members of the RUC is published in the AMA publication, Medicare RBRVS 2009: The Physicians Guide." This publication is available from the AMA here for a mere $71.95 (although now with the notation that the product has been "discontinued.") However, the book is not on the web, or in my local or university library, and I have no other way to easily access it. Thus, the RUC membership is at best relatively opaque.
To expand on the ultimate point, as Goodson(2) noted, RUC "meetings are closed to outside observers except by invitation of the chair." Furthermore, he stated, "proceedings are proprietary and therefore not publicly available for review."
The fog surrounding the operations of the RUC seems to have affected many who write about it. We have posted (here, here, here, and here) about how previous publications about problems with incentives provided to physicians seemed to have avoided even mentioning the RUC. Up until 2010, after the US recent attempt at health care reform, the RUC seemed to remain the great unmentionable. Even the leading US medical journal seemed reluctant to even print its name.
That changed in October, 2010. A combined effort by the Wall Street Journal, the Center for Public Integrity, and Kaiser Health News yielded two major articles about the RUC, here in the WSJ (also with two more spin-off articles), and here from the Center for Public Integrity (also reprinted by Kaiser Health News.) The articles covered the main points about the RUC: its de facto control over how physicians are paid, its "secretive" nature (quoting the WSJ article), how it appears to favor procedures over cognitive physician services, etc.
So the RUC became less anechoic. Now, four months later, there is more news. A new site called "Replace the RUC!" has now appeared, with the following introduction:
This site has been developed - see here for our backgrounds - to help primary care physicians and other interested individuals obtain verifiable background from reputable sources on:
* The evolution and structure of the US' medical payment system.
* How it came to devalue primary care and favor specialty services.
* How that has translated to lower quality care at far greater expense in the US.
We believe the overwhelming majority of American primary care physicians are deeply frustrated with the differences in how primary and specialty care are valued by the current system, and the havoc that system has wrought throughout health care and the nation.
The first step to remedying this situation is for the primary care medical societies to visibly and loudly withdraw from participation in the RUC, de-legitimizing the process.
That said, this effort is most decidedly NOT primarily about getting primary care physicians more money, but bringing our health system back into homeostasis.
We have previously noted that there are many unanswered questions about the RUC:
- How did the government come to fix the payments physicians receive? Government price-fixing has not been popular in the US, yet this has caused no outcry.
- Why is the process by which they are fixed allowed to be so opaque and unaccountable? Why are there no public hearings on the updates, and why is there no input from practicing physicians or organizations other than those related to the RUC?
- How did the RUC become de facto in charge of this process?
- Why does the AMA keep the membership of the RUC so opaque, and give no input into the RUC process to its general membership?
- Why is the RUC membership so dominated by procedural specialists? Why were primary care physicians, who made up at least a sizable minority of physicians when the update process was started, not represented according to their numbers?
- Why has there been so little discussion of the RUC and its responsibility for an extremely expensive health care system dominated by high-technology, expensive, risky and invasive procedures?
Note that "Replace the RUC!" will be added to our link list.
References
1. Bodenheimer T, Berenson RA, Rudolf P. The primary care-specialty income gap: why it matters. Ann Intern Med 2007; 146: 301-306. (Link here.)
2. Goodson JD. Unintended consequences of Resource-Based Relative Value Scale reimbursement. JAMA 2007; 298(19):2308-2310. (Link here.)
RUC It Up - How the US Government Fixes Physicians' Payments Becomes Less Anechoic
We have frequently posted, first here in 2007, and most recently here and here, about the little-known group that controls how the US Medicare system pays physicians, the RBRVS Update Committee, or RUC.
Since 1991, Medicare as set physicians' payments using the Resource Based Relative Value System (RBRVS), ostensibly based on a rational formula to tie physicians' pay to the time and effort the expend, and the resources they consume on particular patient care activities. Although the RBRVS was meant to level the payment playing field for cognitive services, including primary care, vs procedures, over time it has had the opposite effect, as explained by Bodenheimer et al in a 1997 article in the Annals of Internal Medicine.(1) A system that pays a lot for procedures, but much less for diagnosing illnesses, forecasting prognoses, deciding on treatment, understanding patients' values and preferences, when procedures and devices are not involved, is likely to be very expensive, but not necessarily very good for patients.
As we wrote before, to update the system, the Center for Medicare and Medicaid Services (CMS) relies almost exclusively on the advice of the RBRVS Update Committee. The RUC is a private committee of the AMA, touted as an "expert panel" that takes advantage of the organization's First Amendment rights to petition the government. Membership on the RUC is allotted to represent specialty societies, so that the vast majority of the members represent specialties that do procedures and focus on expensive, high-technology tests and treatments. However, the identities of RUC members are opaque, and the proceedings of the group are secret.
To expand on the penultimate point, the current page on the AMA web-site that describes the RUC only lists its members in terms of their specialties and organizational affiliation. Their names do not appear. A response to a previous post by me on the subject by the then Chair and Chair-Elect of the RUC suggested that the RUC membership is not quite secret. They stated that "a list of the individual members of the RUC is published in the AMA publication, Medicare RBRVS 2009: The Physicians Guide." This publication is available from the AMA here for a mere $71.95. However, the book is not on the web, or in my local or university library, and I have no other way to easily access it. Thus, the RUC membership as at best relatively opaque.
To expand on the ultimate point, as Goodson(2) noted, RUC "meetings are closed to outside observers except by invitation of the chair." Furthermore, he stated, "proceedings are proprietary and therefore not publicly available for review."
The fog surrounding the operations of the RUC seems to have affected many who write about. We have posted (here, here, here, and here) about how previous publications about problems with incentives provided to physicians seemed to have avoided even mentioning the RUC. Up until now in 2010, after the US recent attempt at health care reform, the RUC seems to remain the great unmentionable. Even the leading US medical journal seems reluctant to even print its name.
That has just changed. A combined effort by the Wall Street Journal, the Center for Public Integrity, and Kaiser yielded two major articles about the RUC, here in the WSJ (also with two more spin-off articles), and here from the Center for Public Integrity (also reprinted by Kaiser Health News.) The articles cover the main points about the RUC: its de facto control over how physicians are paid, its "secretive" nature (quoting the WSJ article), how it appears to favor procedures over cognitive physician services, etc.
So the RUC has suddenly become less anechoic.
However, despite the best efforts of some very good investigative reporters, there still are important unanswered questions, questions we have raised before:
See also comments on other blogs: DBs Medical Rants, GoozNews, and Managed Care Matters.
ADDENDUM - Additionally, see comments on the Retired Doc's Thoughts blog, and the Running a Hospital blog.
References
1. Bodenheimer T, Berenson RA, Rudolf P. The primary care-specialty income gap: why it matters. Ann Intern Med 2007; 146: 301-306. (Link here.)
2. Goodson JD. Unintended consequences of Resource-Based Relative Value Scale reimbursement. JAMA 2007; 298(19):2308-2310. (Link here.)
Since 1991, Medicare as set physicians' payments using the Resource Based Relative Value System (RBRVS), ostensibly based on a rational formula to tie physicians' pay to the time and effort the expend, and the resources they consume on particular patient care activities. Although the RBRVS was meant to level the payment playing field for cognitive services, including primary care, vs procedures, over time it has had the opposite effect, as explained by Bodenheimer et al in a 1997 article in the Annals of Internal Medicine.(1) A system that pays a lot for procedures, but much less for diagnosing illnesses, forecasting prognoses, deciding on treatment, understanding patients' values and preferences, when procedures and devices are not involved, is likely to be very expensive, but not necessarily very good for patients.
As we wrote before, to update the system, the Center for Medicare and Medicaid Services (CMS) relies almost exclusively on the advice of the RBRVS Update Committee. The RUC is a private committee of the AMA, touted as an "expert panel" that takes advantage of the organization's First Amendment rights to petition the government. Membership on the RUC is allotted to represent specialty societies, so that the vast majority of the members represent specialties that do procedures and focus on expensive, high-technology tests and treatments. However, the identities of RUC members are opaque, and the proceedings of the group are secret.
To expand on the penultimate point, the current page on the AMA web-site that describes the RUC only lists its members in terms of their specialties and organizational affiliation. Their names do not appear. A response to a previous post by me on the subject by the then Chair and Chair-Elect of the RUC suggested that the RUC membership is not quite secret. They stated that "a list of the individual members of the RUC is published in the AMA publication, Medicare RBRVS 2009: The Physicians Guide." This publication is available from the AMA here for a mere $71.95. However, the book is not on the web, or in my local or university library, and I have no other way to easily access it. Thus, the RUC membership as at best relatively opaque.
To expand on the ultimate point, as Goodson(2) noted, RUC "meetings are closed to outside observers except by invitation of the chair." Furthermore, he stated, "proceedings are proprietary and therefore not publicly available for review."
The fog surrounding the operations of the RUC seems to have affected many who write about. We have posted (here, here, here, and here) about how previous publications about problems with incentives provided to physicians seemed to have avoided even mentioning the RUC. Up until now in 2010, after the US recent attempt at health care reform, the RUC seems to remain the great unmentionable. Even the leading US medical journal seems reluctant to even print its name.
That has just changed. A combined effort by the Wall Street Journal, the Center for Public Integrity, and Kaiser yielded two major articles about the RUC, here in the WSJ (also with two more spin-off articles), and here from the Center for Public Integrity (also reprinted by Kaiser Health News.) The articles cover the main points about the RUC: its de facto control over how physicians are paid, its "secretive" nature (quoting the WSJ article), how it appears to favor procedures over cognitive physician services, etc.
So the RUC has suddenly become less anechoic.
However, despite the best efforts of some very good investigative reporters, there still are important unanswered questions, questions we have raised before:
- How did the government come to fix the payments physicians receive? Government price-fixing has not been popular in the US, yet this has caused no outcry.
- Why is the process by which they are fixed allowed to be so opaque and unaccountable? Why are there no public hearings on the updates, and why is there no input from practicing physicians or organizations other than those related to the RUC?
- How did the RUC become de facto in charge of this process?
- Why does the AMA keep the membership on the RUC so opaque, and give no input into the RUC process to its general membership?
- Why is the RUC membership so dominated by procedural specialists? Why were primary care physicians, who made up at least a sizable minority of physicians when the update process was started, not represented according to their numbers?
- Why has there been so little discussion of the RUC and its responsibility for an extremely expensive health care system dominated by high-technology, expensive, risky and invasive procedures?
See also comments on other blogs: DBs Medical Rants, GoozNews, and Managed Care Matters.
ADDENDUM - Additionally, see comments on the Retired Doc's Thoughts blog, and the Running a Hospital blog.
References
1. Bodenheimer T, Berenson RA, Rudolf P. The primary care-specialty income gap: why it matters. Ann Intern Med 2007; 146: 301-306. (Link here.)
2. Goodson JD. Unintended consequences of Resource-Based Relative Value Scale reimbursement. JAMA 2007; 298(19):2308-2310. (Link here.)
RUC Off - the New England Journal Once Again Fails to Mention the Unmentionable
Last week, the influential New England Journal of Medicine published an article by Bruce Vladek entitled "Fixing Medicare's Physician Payment System."(1) Although only identified as working for Nexara, a health consulting business, Mr Vladek was a former administrator of what was then called the Health Care Financing Administration (HCFA) of the US Department of Health and Human Services (DHHS), the part of the department that then ran the US Medicare program. Vladek thus can reasonably be viewed as an expert on Medicare.
Vladek identified two main problems with the current way physicians are paid by Medicare. First,
Second,
Vladek expanded on the second point as follows
This is about all that Vladek wrote about how the imbalance between how Medicare pays for primary care and other "cognitive services," and for procedures came about. Vladek, and many others have argued that this imbalance has lead to strong financial incentives that have been slowly destroying primary care, and strong incentives that have lead to the use of too many procedures, both strong drivers of rising costs in the most expensive health care system in the world.
Vladek noted vaguely that "through various reasons," the incentives were imbalanced by "the process of annual updating of relative value units."
However, as we have discussed in several blog posts, a lot more is known about how this process got "totally off track."
In fact, in 2007, an article by Bodenheimer et al in the Annals of Internal Medicine explained the problems in considerably more detail.(2) As we wrote then, Its main points included
To expand on the penultimate point, the current page on the AMA web-site that describes the RUC only lists its members in terms of their specialties and organizational affiliation. Their names do not appear. A response to a previous post by me on the subject by the then Chair and Chair-Elect of the RUC suggested that the RUC membership is not quite secret. They stated that "a list of the individual members of the RUC is published in the AMA publication, Medicare RBRVS 2009: The Physicians Guide." This publication is available from the AMA here for a mere $71.95. However, the book is not on the web, or in my local or university library, and I have no other way to easily access it. Thus, the RUC membership as at best relatively opaque.
To expand on the ultimate point, as Goodson(3) noted, RUC "meetings are closed to outside observers except by invitation of the chair." Furthermore, he stated, "proceedings are proprietary and therefore not publicly available for review."
The fog surrounding the operations of the RUC seems to have affected many who write about. We have posted (here, here, and here) about how previous publications about problems with incentives provided to physicians seemed to have avoided even mentioning the RUC. In 2010, post the US recent attempt at health care reform, the RUC seems to remain the great unmentionable. Even the leading US medical journal seems reluctant to even print its name.
Thus, as we noted before, however, the mysteries about it remain:
References
1. Vladek B. Fixing Medicare's physician payment system. N Engl J Med 2010; 362:1955-1957. (Link here.)
2. Bodenheimer T, Berenson RA, Rudolf P. The primary care-specialty income gap: why it matters. Ann Intern Med 2007; 146: 301-306. (Link here.)
3. Goodson JD. Unintended consequences of Resource-Based Relative Value Scale reimbursement. JAMA 2007; 298(19):2308-2310. (Link here.)
Vladek identified two main problems with the current way physicians are paid by Medicare. First,
Medicare is captive to an arbitrary, if elegantly conceived, formula for total payments to physicians — the sustainable growth rate (SGR). In the alternate reality of the Congressional budget process, the SGR will reduce Medicare's physician payments, which already trail those from private insurers, as far into the future as the eye can see.
Second,
there is widespread consensus that the relative fees in the current system are a significant cause of the growing imbalance in supply and utilization between primary care and specialty services in the U.S. health care system. That imbalance, in turn, is widely perceived as a major cause of both excessive costs and inadequate quality of care. This is not just a Medicare problem: the Medicare Resource-Based Relative Value Scale is used by most private insurers to set relative prices for physicians.
Vladek expanded on the second point as follows
the basic mechanics of the Medicare Physician Fee Schedule, which was supposed to change physician payment to increase rewards for primary care services at the expense of procedural and interventional services, appears to have gone totally off track. For various reasons, the fee schedule, which originally did increase the prices of evaluation and management services relative to those of surgery or invasive procedures, turned in the other direction through the process of annual updating of relative value units. Surgeons, radiologists, and some medical specialists are now paid two to three times as much per hour as providers of cognitive services, which is about where we began 20 years ago; this was the situation that the fee schedule was supposed to fix.
The question of the relative virtues of primary versus specialty care can be debated ad nauseam, but in other wealthy countries that serve their populations at least as well as we do, the ratio of primary care physicians to specialists is much higher than in the United States, and the gap in compensation is much smaller or the poles even reversed. Young physicians, burdened by increasing educational debts, may well choose a career path on the basis of a major difference in compensation, especially when the better-compensated positions require less ongoing responsibility for patients and offer better working hours.
This is about all that Vladek wrote about how the imbalance between how Medicare pays for primary care and other "cognitive services," and for procedures came about. Vladek, and many others have argued that this imbalance has lead to strong financial incentives that have been slowly destroying primary care, and strong incentives that have lead to the use of too many procedures, both strong drivers of rising costs in the most expensive health care system in the world.
Vladek noted vaguely that "through various reasons," the incentives were imbalanced by "the process of annual updating of relative value units."
However, as we have discussed in several blog posts, a lot more is known about how this process got "totally off track."
In fact, in 2007, an article by Bodenheimer et al in the Annals of Internal Medicine explained the problems in considerably more detail.(2) As we wrote then, Its main points included
- Proceduralists are often able to learn how to do their procedures more quickly, and thus increase the volume of procedures done, while office and hospital visits can only be sped up so much.
- The process used to update the RBRVS system is biased towards procedures for three main reasons: 1. "specialty society influence in proposing RVU [relative value unit] increases," 2. the specialist-heavy RUC [Relative Value Scale Update Committee] membership," and 3. "the desire of RUC specialists to avoid increases in evaluation and management [that is, cognitive, or non-procedural] RVUs."
- Medicare now uses a formula to limit increases in overall spending. The use of this formula leads to across the board cuts in all reimbursements. Since cognitive services reimbursements were never high to begin with, and have rarely been individually increased, these cuts tend to have disproportionate decreases.
- Private insurers and managed care organizations tend to follow Medicare's lead in their reimbursement procedures, but tend to tilt the playing field even more in favor of procedures versus cognitive services. Several studies showed that such payers paid more for procedures than did Medicare, but about the same for office and hospital visits.
To expand on the penultimate point, the current page on the AMA web-site that describes the RUC only lists its members in terms of their specialties and organizational affiliation. Their names do not appear. A response to a previous post by me on the subject by the then Chair and Chair-Elect of the RUC suggested that the RUC membership is not quite secret. They stated that "a list of the individual members of the RUC is published in the AMA publication, Medicare RBRVS 2009: The Physicians Guide." This publication is available from the AMA here for a mere $71.95. However, the book is not on the web, or in my local or university library, and I have no other way to easily access it. Thus, the RUC membership as at best relatively opaque.
To expand on the ultimate point, as Goodson(3) noted, RUC "meetings are closed to outside observers except by invitation of the chair." Furthermore, he stated, "proceedings are proprietary and therefore not publicly available for review."
The fog surrounding the operations of the RUC seems to have affected many who write about. We have posted (here, here, and here) about how previous publications about problems with incentives provided to physicians seemed to have avoided even mentioning the RUC. In 2010, post the US recent attempt at health care reform, the RUC seems to remain the great unmentionable. Even the leading US medical journal seems reluctant to even print its name.
Thus, as we noted before, however, the mysteries about it remain:
- How did the government come to fix the payments physicians receive? Government price-fixing has not been popular in the US, yet this has caused no outcry.
- Why is the process by which they are fixed allowed to be so opaque and unaccountable? Why are there no public hearings on the updates, and why is there no input from practicing physicians or organizations other than those related to the RUC?
- How did the RUC become de facto in charge of this process?
- Why does the AMA keep the membership on the RUC so opaque, and give no input into the RUC process to its general membership?
- Why is the RUC membership so dominated by procedural specialists? Why were primary care physicians, who made up at least a sizable minority of physicians when the update process was started, not represented according to their numbers?
- Why has there been so little discussion of the RUC and its responsibility for an extremely expensive health care system dominated by high-technology, expensive, risky and invasive procedures?
References
1. Vladek B. Fixing Medicare's physician payment system. N Engl J Med 2010; 362:1955-1957. (Link here.)
2. Bodenheimer T, Berenson RA, Rudolf P. The primary care-specialty income gap: why it matters. Ann Intern Med 2007; 146: 301-306. (Link here.)
3. Goodson JD. Unintended consequences of Resource-Based Relative Value Scale reimbursement. JAMA 2007; 298(19):2308-2310. (Link here.)
The Health Care Reform Bill and Health Care Renewal
I have not written much about the seemingly endless health care reform debate in the US, because much of it has not been relevant to the issues we discuss on Health Care Renewal. Now that the current phase of the debate is done, and legislation has been passed, let me offer my opinions on the few aspects that do seem relevant to this blog.
The Sunshine Act
For Health Care Renewal readers, the most important part of the legislation is that containing the provisions of the Sunshine Act, championed by Senators Grassley and Kohl. (See this summary on Postscript, the Prescription Project blog.) The act requires that all drug, device, biologic, and medical supply manufacturers report essentially all payments to physicians or teaching hospitals to the goverment, and on the internet. It does not appear that the rules apply to other health care related non-profit organizations, e.g., medical schools, disease advocacy groups, health care related charities, medical societies, etc, or to payments made by for-profit health insurers, clinical research organizations, and some other corporations. Unfortunately, the provisions only take effect in 2013. However, despite these quibbles, this still may be one of the most important advances promoting disclosure of health care related conflicts of interest made in the 21st century.
Comparative Effectiveness Research
As best as I can tell at this point, the current legislation used the wording from the bill previously passed in the US Senate, which we discussed here and here, regarding comparative effectiveness research. Although its goal of setting up a not-for-profit comparative effectiveness organization seems laudable, the devil will be in the details. The Senate version gave considerable oversight of this organization to those with vested interests in selling particular products or services, threatening the impartiality of the organization and the research it would sponsor, and perhaps thus wholly defeating its ostensible purpose. Furthermore, the Senate bill included curious wording that seems to threaten the ability of those getting funding from the organization to express views that might disturb the organization's leadership, again threatening the integrity of their dissemination of its work, and perhaps violating the First Amendment of the US Constitution. Whether these provisions provide benefits that outweigh their harms is highly questionable.
Payments to Physicians
We have criticized how the process of setting payments to physicians by the US Medicare system has been captured by a secretive committee of the American Medical Association that is dominated by physicians who do procedures, the RBRVS Update Committee, or RUC. The results have been payments for primary care and other cognitive services that have failed to keep up with inflation, a major cause of the continuing decline of generalist/ primary care medicine in the US. (See most recent post here about this.) According to the summary provided by the American College of Physicians (here), the new legislation would enable review of payments made for specific services, and would reconsideration of the process used to set physician payments by an independent advisory group. However, the bill would not mandate any changes in payments, or in the processes used to set them, including the pivotal role of the RUC. So there is some chance that the legislation would lead to a more transparent, accountable, honest, and rational process for setting physician payments and hence eliminating perverse incentives, but no guarantee of such favorable changes.
Summary
The legislation seemingly will result in one major advance fostering disclosure of some conflicts of interest, and perhaps some progress in terms of reducing perverse incentives generated by Medicare's payments to physicians, and possibly reducing regulatory capture of this process. It likely will result in more comparative effectiveness research, but how badly it will be biased in favor of vested interests is unclear. As far as I can tell, the legislation will leave most of the other problems we discuss on Health Care Renewal untouched. We thus have one or two small steps for mankind, but no reason for complacency.
the news is not bad, but we are still a long way from meaningfully addressing concentration and abuse of power in health care. There will be no rest for the weary bloggers of Health Care Renewal.
Also, see comments here and here by Dr Howard Brody on the Hooked: Ethics, Medicine and Pharma blog.
ADDENDUM (25 March, 2010) - Also see comments on the Sunshine Act by Alison Bass on the Alison Bass Blog.
The Sunshine Act
For Health Care Renewal readers, the most important part of the legislation is that containing the provisions of the Sunshine Act, championed by Senators Grassley and Kohl. (See this summary on Postscript, the Prescription Project blog.) The act requires that all drug, device, biologic, and medical supply manufacturers report essentially all payments to physicians or teaching hospitals to the goverment, and on the internet. It does not appear that the rules apply to other health care related non-profit organizations, e.g., medical schools, disease advocacy groups, health care related charities, medical societies, etc, or to payments made by for-profit health insurers, clinical research organizations, and some other corporations. Unfortunately, the provisions only take effect in 2013. However, despite these quibbles, this still may be one of the most important advances promoting disclosure of health care related conflicts of interest made in the 21st century.
Comparative Effectiveness Research
As best as I can tell at this point, the current legislation used the wording from the bill previously passed in the US Senate, which we discussed here and here, regarding comparative effectiveness research. Although its goal of setting up a not-for-profit comparative effectiveness organization seems laudable, the devil will be in the details. The Senate version gave considerable oversight of this organization to those with vested interests in selling particular products or services, threatening the impartiality of the organization and the research it would sponsor, and perhaps thus wholly defeating its ostensible purpose. Furthermore, the Senate bill included curious wording that seems to threaten the ability of those getting funding from the organization to express views that might disturb the organization's leadership, again threatening the integrity of their dissemination of its work, and perhaps violating the First Amendment of the US Constitution. Whether these provisions provide benefits that outweigh their harms is highly questionable.
Payments to Physicians
We have criticized how the process of setting payments to physicians by the US Medicare system has been captured by a secretive committee of the American Medical Association that is dominated by physicians who do procedures, the RBRVS Update Committee, or RUC. The results have been payments for primary care and other cognitive services that have failed to keep up with inflation, a major cause of the continuing decline of generalist/ primary care medicine in the US. (See most recent post here about this.) According to the summary provided by the American College of Physicians (here), the new legislation would enable review of payments made for specific services, and would reconsideration of the process used to set physician payments by an independent advisory group. However, the bill would not mandate any changes in payments, or in the processes used to set them, including the pivotal role of the RUC. So there is some chance that the legislation would lead to a more transparent, accountable, honest, and rational process for setting physician payments and hence eliminating perverse incentives, but no guarantee of such favorable changes.
Summary
The legislation seemingly will result in one major advance fostering disclosure of some conflicts of interest, and perhaps some progress in terms of reducing perverse incentives generated by Medicare's payments to physicians, and possibly reducing regulatory capture of this process. It likely will result in more comparative effectiveness research, but how badly it will be biased in favor of vested interests is unclear. As far as I can tell, the legislation will leave most of the other problems we discuss on Health Care Renewal untouched. We thus have one or two small steps for mankind, but no reason for complacency.
the news is not bad, but we are still a long way from meaningfully addressing concentration and abuse of power in health care. There will be no rest for the weary bloggers of Health Care Renewal.
Also, see comments here and here by Dr Howard Brody on the Hooked: Ethics, Medicine and Pharma blog.
ADDENDUM (25 March, 2010) - Also see comments on the Sunshine Act by Alison Bass on the Alison Bass Blog.
The Role of the RUC in Medicare's Price-Fixing and Rationing Remains Anechoic
An important part of the noisy and contentious debate about health care reform in the US centers on the role of the government as a provider of health insurance. Some on the left want a government "single-payer" plan to be the only health insurance available. Some left of center want a government "public option" health insurance plan to be available, particularly to those who have trouble obtaining commercial insurance. Some on the right want none of it, and sometimes note that the existing government single-payer plan for the elderly and disabled, Medicare, has important faults that would only become more significant if the plan is extended or duplicated. Yet even critics of Medicare on the right do not seem to want to talk about what may be its worst fault.
The latest example, an op-ed piece by Dr Scott Gottlieb, appeared in the Wall Street Journal yesterday. Dr Gottlieb's main point was that health care rationing by either government or private insurers is inevitable, but that "government does it in far more byzantine and arbitrary ways." In particular,
Gottlieb then cited several examples, "tortured decisions concerning the use of implantable defibrillators," and "the travails of the pharmaceutical company Spracor and its drug Xopenex, an innovative respiratory medicine that competes with the chemically distinct and much cheaper generic albuterol."
Finally Gottlieb decried Medicare's decision making processes applied to costly technologies as "impenetrable." His summation was
Let me first say that I actually agree with Dr Gottlieb's main points. Any government or private health insurance plan ought to seek value for its money. However, how it does so ought to be rational, based on understanding of medicine and the clinical context, and transparent and accountable to the patients on whose behalf such plans pay. "Covert rationing" (as has been well discussed in the Covert Rationing Blog) raises worries that decisions are being made just to save money, not to improve value, and even that decisions are being made without informed consideration of the clinical context, or based on the self-interest of the decision makers, or even that decisions may result from bribery and corruption.
But if Dr Gottlieb is so concerned about Medicare rationing care as a result of opaque and unaccountable decision making, why is he not more concerned about how Medicare controls the prices of physicians' services than about its decisions about a few expensive, high-tech and infrequently used treatments?
We have written again and again about how Medicare has allowed decisions about what physicians are paid for providing various services to be made de facto by an opaque private committee run by the American Medical Association. This decision-making process has lead to relatively generous payments for procedures, versus miserly payments for "cognitive services," (that is, "evaluation and management services," or for physicians interviewing, examining, and counseling patients, making diagnoses, predicting prognoses, and making decisions about treatment.) The resulting perverse incentives are a major reason that primary care has become increasingly unavailable, and for our expensive patterns of care dominated by high-technology and invasive procedures. More detail quoted from a previous post appears below.
The lack of discussion of the RUC remains one of the more striking examples of the anechoic effect. Failing to address why our costs are so high, are access is so poor, and our quality is so challenged will make it likely that any supposed reform effort will only make these problems worse.
References
1. Bodenheimer T, Berenson RA, Rudolf P. The primary care-specialty income gap: why it matters. Ann Intern Med 2007; 146: 301-306. Link here.
2. Goodson JD. Unintended consequences of Resource-Based Relative Value Scale reimbursement. JAMA 2007; 298(19):2308-2310. Link here.
The latest example, an op-ed piece by Dr Scott Gottlieb, appeared in the Wall Street Journal yesterday. Dr Gottlieb's main point was that health care rationing by either government or private insurers is inevitable, but that "government does it in far more byzantine and arbitrary ways." In particular,
Consider the $450 billion Medicare program. It provides a model for—indeed its bureaucracy could well end up running—the 'public option' health plan that Mr. Obama wants to offer all Americans under the age of 65. In recent years, Medicare's staff has been aggressively restricting coverage for costly treatments.
This often means limiting access to the costliest technologies. To do this Medicare relies on its rationing and pricing systems.
Gottlieb then cited several examples, "tortured decisions concerning the use of implantable defibrillators," and "the travails of the pharmaceutical company Spracor and its drug Xopenex, an innovative respiratory medicine that competes with the chemically distinct and much cheaper generic albuterol."
Finally Gottlieb decried Medicare's decision making processes applied to costly technologies as "impenetrable." His summation was
There's nothing inherently wrong with a program like Medicare seeking value for taxpayers. But it shouldn't make up the rules as it goes.
Let me first say that I actually agree with Dr Gottlieb's main points. Any government or private health insurance plan ought to seek value for its money. However, how it does so ought to be rational, based on understanding of medicine and the clinical context, and transparent and accountable to the patients on whose behalf such plans pay. "Covert rationing" (as has been well discussed in the Covert Rationing Blog) raises worries that decisions are being made just to save money, not to improve value, and even that decisions are being made without informed consideration of the clinical context, or based on the self-interest of the decision makers, or even that decisions may result from bribery and corruption.
But if Dr Gottlieb is so concerned about Medicare rationing care as a result of opaque and unaccountable decision making, why is he not more concerned about how Medicare controls the prices of physicians' services than about its decisions about a few expensive, high-tech and infrequently used treatments?
We have written again and again about how Medicare has allowed decisions about what physicians are paid for providing various services to be made de facto by an opaque private committee run by the American Medical Association. This decision-making process has lead to relatively generous payments for procedures, versus miserly payments for "cognitive services," (that is, "evaluation and management services," or for physicians interviewing, examining, and counseling patients, making diagnoses, predicting prognoses, and making decisions about treatment.) The resulting perverse incentives are a major reason that primary care has become increasingly unavailable, and for our expensive patterns of care dominated by high-technology and invasive procedures. More detail quoted from a previous post appears below.
Our most recent posts about the RUC are here, here, and here. Other bloggers, notably including Dr Robert Centor on DB's Medical Rants, have criticized the RUC. The Society of General Internal Medicine seems to be the only medical society that has criticized the RUC (see this post). Yet even ostensibly conservative and libertarian pundits who decry price-fixing and rationing by Medicare have ignored this vivid and important example of opaque and unaccountable price-fixing and rationing. And ostensibly liberal proponents of public options and single-payer systems have not explained how they would make their rationing more rational, transparent, and accountable, or how simply insuring more patients under Medicare-like programs would not result in even higher costs, poorer access, and worse quality.As we have discussed, the US Medicare system determines what it pays physicians using the Resource Based Relative Value System (RBRVS). This system determines the pay for every kind of medical encounter according to a complex formula that is supposed to account for physicians' time and effort, physicians' practice expense, and the cost of malpractice insurance. The components of physicians' effort assessed are, in turn, technical skill and physical effort; the required mental effort and judgment; and stress due to the potential risk to the patient.
To keep the system, which was started in 1990, current, requires addition of new kinds of encounters, which means encounters involving new kinds of procedures, and updating of the estimates of various components, including physicians' time and effort. To do so, the Center for Medicare and Medicaid Services (CMS) relies almost exclusively on the advice of the RBRVS Update Committee (RUC). The RUC is a private committee of the AMA, touted as an "expert panel" that takes advantage of the organization's First Amendment rights to petition the government. Membership on the RUC is allotted to represent specialty societies, so that the vast majority of the members represent specialties that do procedures and focus on expensive, high-technology tests and treatments. However, the identities of RUC members are secret, as are the proceedings of the group.
This opaque and unaccountable process has resulted in increases outstripping inflation in fees paid for procedures, while fees paid for 'cognitive" medicine,' i.e., for primary care, and for services that involve diagnosis, management of acute and chronic disease, counseling, coordination of care, etc, but not procedures, have lagged inflation. The effects of the RUC have been amplified by the unexplained tendency of commercial managed care and health insurance to track the RBRVS system when making their own payments to physicians.For further details about the RUC, see these posts on Health Care Renewal (here, here, here, here, and here) and important articles by Bodenheimer et al,(1) and Goodson.(2) By the way, why the US Center for Medicare and Medicaid Services (CMS) relies de facto exclusively on the RUC to control the RBRVS system, and why the AMA made the RUC into a secret organization apparently beholden only to the organization's proceduralist members are unanswered questions.
The lack of discussion of the RUC remains one of the more striking examples of the anechoic effect. Failing to address why our costs are so high, are access is so poor, and our quality is so challenged will make it likely that any supposed reform effort will only make these problems worse.
References
1. Bodenheimer T, Berenson RA, Rudolf P. The primary care-specialty income gap: why it matters. Ann Intern Med 2007; 146: 301-306. Link here.
2. Goodson JD. Unintended consequences of Resource-Based Relative Value Scale reimbursement. JAMA 2007; 298(19):2308-2310. Link here.
Labels:
AMA,
anechoic effect,
health care prices,
Medicare,
perverse incentives,
physicians,
rationing,
RUC
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