RVUs: ‘Hijacked’ to favor Specialists?

RVUs determine the amount Medicare, Medicaid, and private payers compensate physicians for various services. But it’s long been questioned whether RVUs are fair. 

RVU measures are determined by CMS with input from the Relative Value Update Committee (RUC), a 26-member AMA committee charged with recommending RVU measures to the federal agency.

The organizations estimate the value of a physician’s service (RVU) based on the amount of time and effort the service takes, the overhead cost and cost due to time the service requires, and the likelihood of complications due to the service.

The goal is to apply a standard and fair monetary value for physician’s services. But that’s where, for those who oppose RVUs, the problems arise.

Primary-care providers are generally reimbursed less than specialists for their services.

In fact, a recent Health Affairs blog called the RVU payment disparities between primary-care providers and specialists “breathtaking” and said the mental effort and judgment aspect of RVUs have been “hijacked” to favor specialist physicians and hospitals.

As an example, Health Affairs compared the RVU for a CPT 99214 (a 25-minute primary-care office visit for an established patient) with the RVU for a 10- to 15-minute visit with an ophthalmologist for cataract extraction with implantation of an intraocular lens.

Medicare pays $111 for the 99214 primary-care service, yet it reimburses the ophthalmologist $697.12.

Though the cataract extraction and implantation may be a costlier service, it’s questionable whether it really justifies a higher payout of nearly $600.

Other healthcare organizations are speaking out regarding similar RVU issues when it comes to fairness.

In June, the American Academy of Family Physicians (AAFP) sent a letter to the RUC calling for more equity in payments for primary-care services. A key element of their request: asking the committee to consider structural changes - including adding more primary-care committee members.

“When you end up with a payment structure that creates a payment for specialists that so far outstrips the value of primary care then I think that we have not got a system that truly values what the communities need,” physician Lori Heim and AAFP board chair told Healthcare Finance News.
In defense of complaints, the AMA says its RUC committee advocates for fair and accurate valuation for all physician services.

“The AMA/specialty Society RVS Update Committee, commonly referred to as the ‘RUC,’ is erroneously assigned blame for any perceived flaws in this payment system,” the AMA said in a statement.

Still, other organizations believe that the RUC is playing a significant role in worsening the payment gap between primary care and specialists.

Recently, six Georgia primary-care physicians filed a lawsuit alleging CMS violates several federal laws in relying on the RUC recommendations to value physician services paid for by Medicare through RVUs.

According to the lawsuit cited in iWatch News, the RUC serves as an “uncharted and unofficial federal advisory committee” to the federal government, staffed by physicians with “significant financial ties” to medical and pharmaceutical companies.

In fact, since 1991 CMS has accepted more than 94 percent of the RUCs recommendations, according to the article which cited AMA statistics as its source.

By law, federal advisory committees are required to hold public meetings and keep public records of proceedings, which the RUC does not do, according to iWatch News.