CMS & The AMA’s RUC Brian Klepper, PhD

1. How Primary Care Became the Job Nobody Wanted (and How to Fix It) CMS & The AMA’s RUC Brian Klepper, PhD

2. The Relative Value Scale Update Committee (RUC) • 31 physicians - 27 specialists & 4 PCPs • CMS’ sole advisors on medical services valuation since 1992 • CMS has historically accepted 90+% of recommendations • Commercial health plans typically follow Medicare’s payment lead • Immense financial impact • Not officially a Federal Advisory Committee. • (FAC). Legal precedent that it is a “de facto FAC.”

3. Non-Representative Composition • Specialist Dominated • Until March, PCPs comprised only 7% of panelists. PCPs are about 35% of US docs. • Many specialties not represented – including (incredibly!), until recently, Geriatrics. • Chair Barbara Levy MD insists its an “expert rather than a representative panel.” (WSJ) • Directly counter to FACA requirements.

4. Non-Representative Composition • Effectively A Lobbying Organization • Dr. Levy: “The work of the RUC benefits the entire Medicare system and is done at no cost to taxpayers.” – i.e., Altruism • Dr. Levy: “We assume that everyone is inflating everything when they come in. They are wanting to fight for the best possible values for their specialties.” – i.e., Lobbying • Dr. Neil Brooks (FP): “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.” – i.e., Horse Trading

5. Secretive • Opaque Proceedings • Proceedings are to develop recommendations that will determine the allocation of Medicare dollars. • Attendance at RUC Meetings by the Chair’s invitation only. • Attendees must sign a non-disclosure agreement. • Directly counter to FACA requirements.

6. Self-Interest Parading As Science • Suspect Methodologies • Self-Selected Samples. Societies notify their members to participate in the surveys. • Members know their responses will drive valuations and reimbursement levels. • The RUC has accepted as few as 30 responses to drive valuation recommendations. • Directly counter to FACA requirements.

7. Financially Conflicted • Panelists Have Financial Ties To Companies That Could Benefit From RUC Decisions* • Dr. Levy: “The RUC has a strict conflict of interest policy for both those presenting to the RUC and for members. RUC members would recuse themselves from discussion or voting on any issue related to a potential conflict.” • Proceedings closed to the public. We’ll have to take her word for it. • Question: Why would companies create these relationships unless there was a reasonable expectation that they would pay off? • Directly counter to FACA requirements. • *Poses, “Conflicts of Interest Affecting Members of the RUC,” Health Care Renewal, 4/26/11

8. Real World Impacts of RUC Influence Over-values specialty services while under-valuing PC Inhibits PC’s moderating influence and accountability function over specialty services. Creates systemic incentives to perform more services, and more expensive services. (Corrodes professionalism by specialists “practicing to the codes.”) Payment disparities between PC and specialties. Crisis-level PC shortage now.

9. Pt. Volumes – Primary vs. Specialty Care • Typical 2012 established primary care office visit duration = 7.5-12 min. 30 years ago, it was 20-25 • PCPs paid by visit, so may refer time-consuming problems • Most specialists profit from procedures • Result: huge increases in specialty visits, outpt diagnostics, procedures

10. Payment Disparities • Compare Primary Care Office Visit (99214) and Cataract Extraction with Intra-Ocular Lens Implant • 99214 – 25 Minutes and 3 Different Problems. Could be anything. Palette is all medical knowledge. Medicare pays $111.36 • Cataract Extraction & Intra-Ocular Lens Implant – 15 minutes. Restores sight! 50 year old, low risk, repetitive procedure. Medicare pays $836.36. • Hourly rate of Ophthalmologist pay is 12.5x PCP pay. • PCP’s job is arguably more complex/challenging. Klepper & Kibbe, Rethinking the Value of Medical Services, Health Affairs Blog, 8/1/11.

13. The average family doc can expect to earn about $10 million less over a career than an invasive cardiologist or an orthopedic surgeon.

14. OECD Data, 2009, From the Incidental Economist, 10/22/10

15. Med Students Are Being Driven Away From PC OECD Data, 2009, From the Incidental Economist, 10/22/10

16. Corrodes Medical Professionalism • Lucrative procedures encourage specialists • to “practice to the codes.” • Physicians who own advanced imagers order them up to 6x more than those who don’t • Stents are no more effective than “optimal drug therapy” and lifestyle changes, and they introduce significant risk/cost. Medicare spends $1.6 billion annually on drug-eluting stents. • Endless examples.

17. Procedural Volumes Medicare spends a fortune each year on procedures that have no proven benefit and should not be covered. When a procedure…is not supported by evidence, …taxpayers should have no obligation to pay for it. Rita Redberg, MD Editor, Annals of Internal Medicine “Squandering Medicare’s Money” NY Times, 5/25/11

18. Winners & Losers • Winners • Nearly Everyone in the Health Industry (Except Primary Care) • Losers • Patients – Unnecessary Care and Risk of Harm • Purchasers (Employers, Taxpayers, Individuals) – Immense Unnecessary Cost • Primary Care Physicians

19. In August, 6 Augusta, GA PCPs filed suit in Maryland Federal Court Against HHS & CMS. • The suit challenges CMS’ longstanding reliance on the RUC without requiring adherence to FACA. • The case will probably go to trial and, possibly, because of the stakes, to the Supreme Court.

20. Comparison with a Federal Advisory Committee • Relative Value Scale Update Committee (for CMS) • Comprised of Volunteers • Proceedings closed to public • Methodologies highly suspect • Conflict practices unknown • Health Information Technology Policy Committee (for ONC) • Comprised of Volunteers • Proceedings publicly available • Methodologies sound • Members must declare conflicts Kibbe & Klepper: “Trusting Govt: A Tale of Two Advisory Groups,” Health Affairs Blog, 2/2/12.

21. Fighting The RUC • Educate. Physicians, Purchasers and Patients need to understand the impact of the RUC on cost/quality. Feel free to snag our stuff and write about it in your local newspaper. • Presentations.This is a great topic for Rotary and Chamber breakfasts. Watch the local manufacturer’s blood boil. Business has every reason to support this! • Demand That The Primary Care Societies Quit the RUC. They’re either conflicted by specialists or in thrall to the AMA. • If they don’t walk, you should. • Financial Support.Help the Augusta docs fight this on your behalf.

22. The Reforms We Need • CMS Should Sever Relationship With RUC. • Replacement by a FAC, comprised of physicians, physicians, purchasers, patients, & health economists • Immediate recalibration of most frequent costly over- and under-valued codes • Better yet: scrap RBRVS and FFS for a value-based payment methodology

23. Brian R. Klepper, PhD is a health care analyst and commentator. He is Chief Development Officer for WeCare TLC, LLC, an onsite primary care clinic and medical management firm based in Longwood, FL, and Managing Principal of Healthcare Performance Inc., a consulting practice based in Atlantic Beach, FL. An active author and speaker, Dr. Klepper has provided health care commentary to CBS Evening News, the Wall Street Journal, the New York Times, and the Washington Post. He has published articles on Kaiser Health News, Medscape, Healthleaders, The New England Journal of Medicine, Modern Healthcare, Business Insurance and newspapers nationally. In December 2010, he founded and now edits Care & Cost, an online professional health care magazine. He is a regular contributor to the Health Affairs Blogand other expert health care blogs. With his wife, he also maintains Elaine’s Journey, which details their struggle against Peritoneal (Ovarian) Cancer. Brian serves on the American Academy of Family Physicians’ Primary Care Services Valuation Task Force, and is a reviewer for Health Affairs and The Journal of Ambulatory Care Management. He serves on the Board of the Consortium for Southeast Hypertension Control (COSEHC), dedicated to translational medicine for vascular disease.  He is an Advisor to the Lundberg Institute, the Patient-Centered Primary Care Collaborative, which advocates for medical homes, and the Center for Value Health Innovation, which helps business identify and implement approaches proven to improve quality while reducing cost. In January 2011, with David Kibbe MD, he began a campaign, Replace the RUC!, that focuses on the most important driver of inappropriate health care cost. That effort has resulted in a lawsuit by six Augusta, GA primary care physicians against the US Centers for Medicare and Medicaid Services (CMS) over its longstanding inappropriate relationship with the AMA’s Relative Value Scale Update Committee (RUC). Contact Brian at 904.395.5530 (o), 904.343.2921 (c), bklepper@gmail.com.