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AMA's Role in Setting Medicare Fees Battered

Margaret Dick Tocknell, for HealthLeaders Media, July 24, 2013

Two prominent media reports critical of the American Medical Association's influence over payment rates for services on the Medicare physician fee schedule coincide with a renewed legislative push to diminish the group's power over pricing.

The Washington Post headline in Sunday's paper, How a Secretive Panel Uses Data that Distort Doctors' Pay, was deliberately provocative. And it got a strong rebuttal from the American Medical Association, in the form of a fact sheet. Among the facts listed: The Committee is not a secretive body.

But that panel, the AMA's Specialty Society Relative Value Scale Update Committee, is again the focus of a legislative effort to clip its wings.

In late June, Rep. Jim McDermott (D-WA) introduced HR 2545 (the Accuracy in Medicare Physician Payment Act of 2013). McDermott, a psychiatrist by training, wants to reduce Medicare's reliance on the committee, which is known in physician circles as the RUC.  

In a statement announcing the bill, McDermott noted that for more than 20 years the Centers for Medicare & Medicaid Services has relied on the RUC committee to "set payment rates for the 7,400 services on the Medicare physician fee schedule. No other area of the Medicare program asks providers to play such an active role in setting their own payments."

The RUC meets three times a year to decide how physician services should be valued, which is a polite euphemism for how services should be priced. Most of the 31 committee members are from medical specialties, although some are primary care practitioners. Over several days of closed proceedings, RUC members vote on service prices, oops, I mean "values."

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1 comments on "AMA's Role in Setting Medicare Fees Battered"


David Harlow (7/25/2013 at 11:42 AM)
That's $85 Billion with a B. - And that's for Medicare physician reimbursement alone. The related costs (facility fees, including devices) are much higher. It is important to understand that even with a move away from fee-for-service medicine, there still needs to be agreement on how to budget for physician and other health care provider services. As this story demonstrates, there is some significant discontentment with the way in which the RUC dominates this issue on the physician side.