Paul M. Fischer and Brian Klepper
If you agree with this letter, please redistribute, particularly to other primary care physicians.
Friends:
As many of you know, we have developed an effort to shine a bright light on the Relative Value Scale Update Committee, or RUC. A new site, Replace the RUC, provides a wealth of expert background information, and we’re working now to get more visibility on this issue.
A specialist-dominated panel within the AMA, the RUC is little known and under-appreciated, but extremely powerful and opaque. More important, through its longstanding relationship with CMS, it is central to the explosion in health care costs over the past 20 years, why primary care physicians are paid so poorly compared to their specialist colleagues and why few medical students now choose to enter primary care as a career. Meaningfully address the RUC, and you relieve America of more health system waste than all the cost control measures in the health care reform law combined.
In its present form, the Resource-Based Relative Value Scale (RBRVS) financially undervalues the challenges associated with primary care management of complicated patients, but favors complex procedures. It is fair to suggest that a significant percentage of the US’ rapid health care premium cost growth – 4 times as fast as general inflation over the past decade – is directly attributable to the RUC’s distortion of this system. Many health care economists now believe that half or more of all American health care expenditures are inappropriate and provide no value. This translates to nearly $1.5 trillion annually, a sum nearly equal to this year’s national debt, twice what we’ll spend on the military this year, or two-thirds again what we’ll spend over the next decade on the economic stimulus package. The health care cost drivers, as they’ve been constituted through RBRVS and the RUC, are the difference between America’s economic prosperity and decline.
We have undertaken a four-pronged effort aimed at replacing the RUC and RBRVS.
- Make the public aware of the RUC’s role and urge the primary care societies to stop “enabling” the RUC through their participation. While one of the main goals of RBRVS was to rectify the payment gap between primary care physicians and specialists, the RUC has intensified it. After 20 years of minority participation on the RUC, the average primary care physician can expect to make $3.5 million less over a career than his/her specialist colleagues. Worse, though, is that often unnecessary but expensive procedures dramatically drive up cost while diminishing quality. If the societies loudly and visibly walked away from the RUC, with clear, at-the-ready explanations of why payment parity is critical to the future of primary care and how the lack of it has negatively impacted American health care and the nation’s economy, it would bring the issue to the fore and set the stage for the RUC’s and RBRVS’ replacement by better approaches that appreciate all kinds of complexity and measurable value. Health care funds are and should be limited. In an market that empowers primary care, fewer unnecessary services may translate to lower compensation for specialists.
- Recruit experts who can credibly calculate the economic impacts of the RUC’s actions, and who can devise alternative payment methodologies. We believe it will be critically important to not simply demand an end to the current system, but to offer sensible alternatives.
- Demonstrate the unlawfulness of CMS’ (and HCFA’s) two-decades long reliance on the RUC. We are exploring a lawsuit that would challenge CMS’ longstanding abrogation of its due-diligence process by outsourcing medical procedure valuation to the RUC, an informal, private, financially-conflicted group employing a highly questionable evaluation methodology. Even so, CMS has accepted 94% of the RUC’s recommendations, which most often increase cost.
- Develop a collaboration between primary care and non-health care business. Most of the health care industry benefits handsomely from the excess associated with the current payment system. If it is threatened, they are likely focus considerable resources on blocking change. (The health care industry contributed $1.2 billion to Congress in 2009 to influence the health care bill.) Non-health care business is primary care’s best ally. They understand primary care’s value, are large enough, have the resources and the motivation to counterbalance the health industry’s influence.
We hope you’ll support this effort in several ways.
- Contact your primary care society to demand that they withdraw from the RUC.
- Broaden awareness of what we’re doing and why by rebroadcasting to your primary care colleagues.
- Get in touch to help us with resources, relationships or approaches that can strengthen this project.
Thanks much for your time and consideration.
Paul M. Fischer, MD is a family physician at The Center for Primary Care in Augusta, GA.
Brian Klepper, PhD is a health care analyst based in Atlantic Beach, FL.
Care And Cost 
Why not just end the RUC on your own, by encouraging primary care to drop participation with third parties altogether, lower overhead, and go back to true patient care.
Doctorsh
Gentlemen, drawing attention to the impact of the Relative Value Scale Update Committee on both healthcare priorities and spending over the past several years is truly an important component to in an effort to help those outside the healthcare industry know why we are where we are. Calling for a change in the status quo as quickly as humanly possible is truly an important step in taking us in a more sane direction. Empowering primary care to appropriately and effectively represent both their understanding of the issue and ability to collaborate with non-healthcare business in an effort to reduce not only the cost of care, but more importantly the cost of employing people, will be critical to “repairing the damage” we’ve done to patient health status resulting from years of misplaced priorities and meaningless “cost containment”/”less than retail” payment initiatives.
While restoring value to primary care is important, redefining the relationship between primary care and the “referred to” community, particularly specialist physicians is just as important. Referred to physicians and other providers should be given the opportunity to demonstrate both their ability and willingness to become more “accountable” to the primary care community as they carry out their mission in partnership with non-healthcare business. Financially, each community should be given the opportunity to flesh this out and develop workable and sustainable economics models designed to reward and reinforce improved patient health status and overall outcomes. What we’re beginning to think of as truly value based purchasing. Expecting all physicians, and hospital systems to a large degree, to move away from these “bad habits” through through any other approach makes no sense.
Employers, as the true payor of healthcare, should step forward and support the notion of adopting a more sane way of paying for care, beginning quite logically with primary care. Indeed we see some degree of readiness in this sense as represented by those employers focused on benefit plan redesign and changes in payment methodologies to reward those primary care practices recognized by the National Committee for Quality Assurance (NCQA) as Patient Centered Medical Homes (PCMH). We also see this in those employers who underwrite a dedicated primary care capability for their employees and their employees dependents – on site clinics. Regardless of which approach makes the most sense, employers and primary care physicians should come together, learn from each other, and “reform” the communities they both call home, beginning with the way each segment of the delivery system gets compensated for what it does.
Agree with DoctorSH. Getting out of the RUC is a good step but too little, too late at this point. We need to get most primary care out of the third party payment system.