The RUC Is Bad Medicine; It Has to Go

Brian Klepper, PhD


August 12, 2013

In This Article

The Best Assumptions Money Can Buy

The RUC's work follows the design of the Resource-Based Relative Value Scale (RBRVS), a formulaic system of inputs weighing the contributions of physician work (54%), practice expense (41%), and malpractice expense (5%), devised by a Harvard team in the late 1980s. One assumption here is that the relative weights are approximately accurate across specialties and services. Barbara Levy, MD, a gynecologist and the RUC's Chair, insists that they are. "None of us believe the numbers are fine-tuned. We do believe we get them right with respect to each other."[2]

Of course, this assumes that you accept that primary care is less demanding and time-consuming than specialty services, and that quickly diagnosing and managing a patient presenting with an array of complicated symptoms is easier and less valuable than doing a procedure.

A couple of years ago, David Kibbe, MD, and I explored this assumption by comparing a moderately complex primary care visit[6] in which a physician must address at least 3 different problems in 25 minutes, vs an ophthalmologist's cataract extraction and intraocular lens implant. The cataract procedure, which in basic form is now more than 50 years old, is highly refined, automated, and often performed in assembly-line fashion. Using this comparison's RUC valuations, Medicare pays ophthalmologists at 12.5 times the hourly rate paid to primary care physicians. The demands on the generalists are arguably greater.

Another problem with RBRVS is that it bases payments purely on what physicians subjectively decide that they should be paid, without considering other factors, like value to the end user. Of course, even if Medicare's input-only-based valuation method made sense, there is the question of whether a self-interested panel -- meaning, those who know that their payments will be tied to their recommendations -- can credibly oversee an objective valuation methodology.

Bias Exists

Dr. Levy has admitted that special-interest bias is part of the process. "We assume that everyone is inflating everything when they come in. They are wanting to fight for the best possible values for their specialties."[7]

Horse trading on the valuations apparently is common. Neil Brooks, MD, a family physician and RUC panelist for 4 years, reported, "If radiology presented a new set of codes that had to do with imaging procedures, there was a feeling that some people would go along with that if radiology would go along with other things."[7]

And Roy Poses, MD, who studies financial conflict in medicine and is Clinical Associate Professor of Medicine at Brown University, has documented RUC panelists with financial conflicts that could influence their valuations. "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."[8]

The AMA is fierce about protecting its franchise and has argued strongly that no other interests, even those with a strong stake in care and cost (eg, patients, purchasers, health economists), should participate in the valuation process. Only doctors can understand the value of a medical service, and so they alone must create the basis for what the rest of us pay.


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