A look at the secretive AMA panel behind Medicare's payment rates

A group of 29 physicians, convened by the American Medical Associations and "mostly selected" by specialty trade groups, have the task of recommending how to divide Medicare money into payments for each service, procedure and treatment the program covers, The Wall Street Journal reports. The Relative Value Scale Update Committee, which meets in closed-door, confidential sessions three times a year, "has stoked a debate over whether doctors have too much control over the flow of taxpayer dollars in the $500 billion Medicare program. Its critics fault the committee for contributing to a system that spends too much money on sophisticated procedures, while shorting the type of nuts-and-bolts primary care that could keep patients healthier from the start—and save money." And, Medicare follows it's guidance almost all the time. The RUC chairwoman says, "The RUC is not a perfect process, it's just the best that's out there" (Mathews and McGinty, 10/26).

The RUC process also drives a wedge between physicians of different specialties, The Wall Street Journal reports in a sidebar. "One of the biggest disputes in the Relative Value Scale Update Committee came in 2005, when members clashed over primary-care groups' push for increases in the payments for doctor office visits, which are among the most commonly-billed Medicare services. … At one point, the debate reached such an impasse that J. Leonard Lichtenfeld, who represented the American College of Physicians, and at least one other RUC member, Tom Felger, who represented family physicians, actually came close to ending their involvement in the talks, and asked for a break in the meeting, according to both men. They felt a surgical faction was blocking their push, they say" (Mathews, 10/26).

The Center for Public Integrity, which has collaborated with the Journal on some aspects of this Medicare series, also takes a look at the RUC panel. CPI/Kaiser Health News reports that critics say the physician panel has "a massive and obvious conflict of interest." The AMA, which says the RUC costs more than $7 million a year to run (including volunteer physicians' lost wages), argues that the committee is nothing more than an independent group practicing its First Amendment right to petition the federal government. But the AMA does not try to downplay the RUC's goal," writing in a house pamphlet: " From the AMA's perspective, the RUC provides a vital opportunity for the medical profession to continue to shape its own payment environment" (Eaton, 10/27).

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This article was reprinted from kaiserhealthnews.org with permission from the Henry J. Kaiser Family Foundation. Kaiser Health News, an editorially independent news service, is a program of the Kaiser Family Foundation, a nonpartisan health care policy research organization unaffiliated with Kaiser Permanente.