Health Care Academics' Unrest and Bad Health Care Leadership?

Last month we <a href="http://hcrenewal.blogspot.com/2012/08/will-another-study-on-physician-burnout.html">discussed</a> a recent, large scale study of physician burnout, and wondered whether it would finally inspire some discourse about why physicians are really so upset.  In particular, we hypothesized,  based on some real, if limited data, that physician angst, dissatisfaction, burnout, etc may mainly be a response to the problems with leadership and governance of health care organization we post about on <a href="http://hcrenewal.blogspot.com/">Health Care Renewal.</a><br /><br />After that post, one of our scouts found a very interesting and relevant article from earlier this year which got little attention at the time, but deserves more.  [Pololi LH, Krupat E, Civian JT, Ash AS, Brennan RT. Why are a quarter of faculty considering leaving academic medicine? A study of their perceptions of institutional culture and intentions to leave at 26 representative U.S. medical schools. Acad Med. 2012; 87: 859-69. Link <a href="http://www.ncbi.nlm.nih.gov/pubmed/22622213">here</a>.]<br /><br /><b>Study Design</b><br /><br />This was a cross-sectional survey of faculty at 26 medical schools in the US, selected to be similar to the general population of medical schools in the country.  At each school, 150 faculty were randomly chosen stratified by sex and age, and then the sample was enriched to include additional minority faculty and women surgeons, for a total of 4578.<br /><br />The faculty were sent a multi item survey to assess their perception of the organizational culture of their institutions, and asked about their intentions to continue in or leave their current positions and academic medicine.  Responses to each survey item were allowed to be from 1 = strongly disagree, to 5 = strongly agree.  The items on the survey were combined into various scales.  A number of items on the survey seemed to be related to issues we frequently discuss on Health Care Renewal.  These items ended up in three different scales, entitled Relatedness/Inclusion, Values Alignment, and Ethical/Moral Distress.  The survey items are listed below, grouped by issue, with the scales into which they were combined noted.<br /><br />Issue: <a href="http://hcrenewal.blogspot.com/search/label/mission-hostile%20management">Mission-Hostile Leadership</a><br /><br />Administration only interested in me for revenue   (Reverse coded) (Values Alignment)<br />Institution committed to serving the public (VA)<br />Institution's actions well-aligned with stated values and mission (VA)<br />Institution puts own needs ahead of educational/clinical missions (RC) (VA)<br />My values well-aligned with school's (VA)<br />Institution awards excellence in clinical care (VA)<br />Institution does not value teaching (RC) (VA)<br />Have to compromise values to work here (Ethical/Moral Distress)<br /><br />Issue: <a href="http://hcrenewal.blogspot.com/search/label/deception">Deceptive</a>, Unethical Leadership<br /><br />Felt pressure to behave unethically (Ethical/Moral Distress)<br />Need to be deceitful in order to succeed (EMD)<br />Others have taken credit for my work (EMD)<br /><br />Issue: Generation of the <a href="http://hcrenewal.blogspot.com/search/label/anechoic%20effect">Anechoic Effect</a> by  Suppression of <a href="http://hcrenewal.blogspot.com/search/label/free%20speech">Free Speech</a>, <a href="http://hcrenewal.blogspot.com/search/label/academic%20freedom">Academic Freedom</a>, Dissent, <a href="http://hcrenewal.blogspot.com/search/label/whistle-blowers">Whistle-Blowing,</a><br /><br />Feel ignored/ invisible (RC) (Relatedness/Inclusion)<br />Hide what I think and feel (RC) (R/I)<br />Reluctant to express opinion/ fear negative consequences (RC) (R/I)<br /><br />So in summary, the survey contained quite a few questions about mission-hostile management, comprising nearly all of the Values Alignment scale, some questions about deceptive or unethical leadership, all in the Ethical/Moral Distress scale, and some about generation of the anechoic effect by suppression of free speech, academic freedom, dissent, and whistle-blowing, all in the Relatedness/Inclusion scale.<br /><br /><b>Results</b><br /><br />The response rate was 52% (N=2381.)<br /><br />Unfortunately, the article did not include the distributions of the responses to individual survey items, and only included the mean and standard error of the scale scores.  The values for the scales of most interest were:<br />Relatedness/Inclusion  3.56 SE= 0.022<br />Values Alignment  3.25 SE=0.028<br />Ethical/Moral Distress 2.36 SE=0.022<br /><br />Note that the article did not address the degree individual items, especially those listed above, contributed to variation in the scale scores. <br /><br /><br />A small majority of faculty indicated their intentions to stay at their institutions (57%).  Of the remainder, 14% were considering leaving their school due to dissatisfaction, and another 21% were considering leaving academic medicine due to dissatisfaction.  The remainder were considering leaving due to personal/ family reasons or to retire.<br /><br />The authors did complex multinomial logit modeling to assess the relationships among the various scales, demographic factors, and intention to leave.  Most relevant to us, Relatedness/Inclusion was significantly related to intention to leave the institution due to dissatisfaction (Coefficient -0.69, p lt 0.001, OR =0.50), as was Values Alignment (-0.39, p=0.04, OR=0.68), but not Ethical/ Moral Distress.  Furthermore, Relatedness/Inclusion was related to intention to leave academic medicine due to dissatisfaction (-0.48, p lt 0.001, 0.62), as was Ethical/Moral Distress (0.60, p lt 0.001, OR =1.82). The article did not address whether individual survey items, including those of most interest listed above, were related to intention to leave.  The article also did not address whether responses to the survey or intention to leave varied across faculty characteristics, medical school characteristics, or individual medical schools.  <br /><br /><b>Summary and Comments</b><br /><br />This very large survey of faculty from multiple US medical schools showed that more than one-third were considering leaving their institutions or academic medicine due to dissatisfaction, indicating a striking prevalence of faculty distress.  Their responses to questions about perceived organizational cultural and leadership problems, including those possibly related to leadership's perceived hostility to the mission, leadership's perceived dishonesty or unethical behavior, and leadership's suppression of dissent, free speech, academic freedom, and whistle-blowing were related to their intentions to leave due to dissatisfaction.<br /><br />These results suggest the hypothesis that much of faculty angst may be due to the sorts of problems with leadership and hence organizational culture that we discuss on Health Care Renewal.  Since this was a cross-sectional survey, it certainly does not offer scientific proof of this hypothesis.  Note that there is other evidence from numerous cases discussed in Health Care Renewal, qualitative studies and our much smaller study published only in abstract form that also supports this hypothesis (look <a href="http://hcrenewal.blogspot.com/2012/08/will-another-study-on-physician-burnout.html">here</a>).  <br /><br />One part of the author's discussion of their findings was particularly relevant:<br /><br /><br /><blockquote class="tr_bq">Our findings are congruent with metaanalyses of 25 years of organizational justice research outside medicine. These studies suggest that employee perceptions of organizational justice and an ethical climate are related to increased job satisfaction, trust in leadership, enhanced performance, commitment to one’s employer, and reduced turnover.<br /><br /> The scale of ethical/moral distress (see Table 1) reflects<i> reactions to the prevailing norms and possible erosion of professionalism and increased organizational self-interest</i>. There is a growing belief that organizations influence and are responsible for the ethical or unethical behaviors of their employees.To our knowledge, faculty perceptions of 'moral atmosphere' and 'just community' embedded in our survey have not been previously investigated in academic medicine, even though the ethical concepts of professionalism and justice can be used to guide the pursuit of excellence in the missions of medical schools. Several scholars have called for academic medicine to attend to its social justice and moral mission. Faculty perceptions<br />of organizational justice are pivotal to the critical issue of professionalism in medicine. The ethical/moral distress scale in the survey reported here included items such as 'the culture of my institution discourages altruism' and 'I find working here to be dehumanizing.' (See Table 1 for other items in this scale.) In that ethical/moral distress was more strongly related to intent to leave academic medicine entirely than intent to leave one’s own institution, these negative feelings among faculty must be particularly disheartening to them and may color major career decisions.</blockquote>I believe that the study by Pololi et al adds to the evidence that physician distress is a symptom of a dysfunctional system in which major health care organizations have been taken over by leaders more devoted to self-interest and short-term revenue than the values prized by health care professionals and academics.  This applies obviously to academic medical institutions, but also to other organizations that might have been expected to defend such professional and academic values, such as professional associations, accrediting organizations, and health care foundations.  As we <a href="http://hcrenewal.blogspot.com/2012/08/will-another-study-on-physician-burnout.html">said before</a>, if physicians really want to address what is making them burned out and dissatisfied, they will have to regain control of their own societies, organizations, and academic institutions, and ensure that these organizations put core values, not revenue generation and providing  cushy compensation to their executives, first.   <br /><br /><!--0-->

Health Care Academics' Unrest and Bad Health Care Leadership?

Last month we discussed a recent, large scale study of physician burnout, and wondered whether it would finally inspire some discourse about why physicians are really so upset.  In particular, we hypo…

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BLOGSCAN - Why Not Just Pay Physicians By the Hour?

<span style="color: #38761d;">We have frequently discussed how </span><a href="http://hcrenewal.blogspot.com/search/label/perverse%20incentives"><span style="color: #38761d;">perverse incentives</span></a><span style="color: #38761d;"> are spread around health care.  In the US, the physicians are paid according to a system that provides strong incentives for doing procedures, (see </span><a href="http://hcrenewal.blogspot.com/search/label/RUC"><span style="color: #38761d;">our posts</span></a><span style="color: #38761d;"> about how the RUC has encouraged this bias towards procedures.)   Since physicians are the most influential "deciders" about the care of individual patients, these incentives encourage overtesting and overtreatment with the highest technology, driving up costs and subjecting patients to increased risks of adverse events.  The recent health care reform law, however, essentially encouraged a version of capitated payment, which might very well provide incentives for undertreatment and undertesting.  For years, Dr Robert Centor has argued logically and forcefully for paying physicians for the time they spend on behalf of payments, very analogous to how lawyers and many other professionals are paid.  This might provide much more neutral, less perverse incentives than would existing or other proposed physician payment schemes.  Dr Centor </span><a href="http://www.medrants.com/archives/6991"><span style="color: #38761d;">argued again</span></a><span style="color: #38761d;"> for this seemingly reasonable and logical idea on his DB's Medical Rants blog.  The big question is why this idea has been so </span><a href="http://hcrenewal.blogspot.com/search/label/anechoic%20effect"><span style="color: #38761d;">anechoic</span></a><span style="color: #38761d;">? </span>

BLOGSCAN - Why Not Just Pay Physicians By the Hour?

We have frequently discussed how perverse incentives are spread around health care.  In the US, the physicians are paid according to a system that provides strong incentives for doing procedures, (see…

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Will Another Study on Physician Burnout Finally Lead to Addressing its Causes?

The latest article on physician burnout has actually attracted some media attention.  e.g., <a href="http://www.usatoday.com/money/industries/health/story/2012-08-20/physician-burnout/57173110/1">here</a> and <a href="http://www.bloomberg.com/news/2012-08-20/about-half-of-doctors-say-they-re-burned-out-by-workload.html">here</a>.<br /><br /><strong>The Latest Article</strong><br /><br />The article was a survey of physicians in all specialties with over 7000 respondents (unfortunately a less than 27% response rate.)(1)  Its most notable findings were:<br />- The rate of burnout among physicians was <em><strong>45.4%</strong></em><br />-  Physician specialties with higher than average rates were emergency medicine, general internal medicine, neurology, and family medicine.<br />- The proportion of physicians who may have been depressed, (using the Primary Care Evaluation of Mental Disorders screening instrument,) was <em><strong>37.8%</strong></em><br /><br />So almost half of all physicians, and more than half of the front-line physicians who treat adults appear to be burned out, while more than one-third of physicians may be clinically depressed.  So it is not surprising that the authors called the rate of burnout "alarming."  <br /><br />They also commented on the implications of their data,<br /><blockquote>Unfortunately, little evidence exists about how to address this problem. Although extensive literature suggests that contributors include excessive workload, loss of autonomy, inefficiency due to excessive administrative burdens, a decline in the sense of meaning that physicians derive from work, and difficulty integrating personal and professional life, few interventions have been tested. <em>Most of the available literature focuses on individual interventions centered on stress reduction training rather than organizational interventions designed to address the system factors that result in high burnout rates. </em></blockquote><strong>Previous Studies of Burnout and Dissatisfaction</strong><br /><br />This study, in fact, is just the latest in a long series of studies showing physicians' growing angst, dissatisfaction, burnout, or whatever one calls it. In 1987, in an AMA survey of physicians over 40, 44% replied that were they given chances to do it all over again, they would not go into medicine.(2)  In a 2001 survey of Massachusetts physicians, 62.3% were dissatisfied with the practice environment.(3)  In 2002, a national survey by the Kaiser Family Foundation showed that 45% of physicians would not recommend that a young person should go into medicine.(4)   In a survey of primary care physicians in 2007, 38.7% were somewhat or very dissatisfied.(5)  I have a 6 inch thick set of paper files containing articles on the subject, although it is remarkable how many research studies reported only average scores on instruments, and hence did not report proportions of physicians who were burned out or dissatisfied. <br /><br /><strong>The Causes of Dissatisfaction and Burnout</strong><br /><br />What is most remarkable about this voluminous literature is its relative lack of attention to the external forces and influences on physicians that are likely to be producing burnout, and the general aversion to promoting any interventions that could conceivably affect these external threats. Instead, burnout etc has been addressed as if it were some sort of psychiatric disease of physicians. This was noted above by Shanafelt et al. <br /><br />In fact, the reason that we did the crude qualitative literature that lead to my articles on health care dysfunction (6), and to the establishment of <a href="http://hcrenewal.blogspot.com/">Health Care Renewal</a> was a general perception that physician angst was worsening (in the first few years of the 21st century), and that no one was seriously addressing its causes.<br /><br />Our first crude research suggested that physicians' angst was due to perceived threats to their core values, and that these threats arose from the issues this blog discusses: concentration and abuse of power, bad governance and leadership of health care organizations, and the rise of various dishonest and unethical practices that affect physicians. We have found hundreds of cases and anecdotes supporting this viewpoint.<br /><br />There is some corroboration of these assertions.  Some written comments from the 2001 Massachusetts survey made similar points about the causes of dissatisfaction, for example: "too much emphasis on the bottom line.  Taken over by large corporations.  Quality of care and interaction now subsumed by productivity and profit," and "the once most noble profession has become a factory job with a facade of ethics"(3)  Pololi and colleagues' qualitative interviews of young medical faculty included anecdotes of angst due to academic leaders who put revenues ahead of patient care, teaching, and research; and who allegedly used deception for personal gain.(7)  (Also, see our comments on this paper)(8)  Pololi and colleagues' large survey of US medical faculty showed that over half thought that managers were only interested in them because of the money they brought in.(9)   We were able to show in a preliminary analysis of data from a physician survey that an instrument meant to measure physicians' perception of the integrity of the leadership of their organizations, which incorporated questions about whether leaders supported core values, put patient care ahead of revenue, supported transparency about quality issues, put patient care ahead of self-interest, and displayed honesty strongly correlated (negatively) with stress, intention to leave the practice, and burnout.(10) <br /><br />Yet at best studies of physicians' burnout, angst, or dissatisfaction only vaguely allude to "system factors" and not greedy, money-focused, self-interested, or corrupt leadership, etc at its causes.  And again as noted above, most interventions meant to improve burnout have treated it like a psychiatric illness, not a rational response to a badly lead, dysfunctional health care system.<br /><br /><strong>Why Has Nothing Changed?</strong><br /><br />The real question is why so little has changed given this now 20 plus year history of the documentation of burnout, and why there has been such avoidance of what appears to be the real causes of the problem. One question worth raising again at this time is why the organizations one might think would be interested in helping physicians address causes of burnout have not done so.<br /><br />One might think that medical societies, foundations interested in improving health and health care, bodies that accredit physicians, and academic medicine in general would all be interested in addressing the causes of physician burnout, dissatisfaction, and angst.  However, I am aware of no significant action on their part.  (There have bee some some marginal actions by the smallest of these organizations, e.g., the Society of General Internal Medicine's call to "chuck the RUC," see this <a href="http://hcrenewal.blogspot.com/2009/08/sgim-urges-chuck-ruc.html">post</a>)<br /><br />We should not be surprised, since most of these organizations have become more creatures of health care corporations than noble proponents of physicians' core values.  Most of these organizations have substantial institutional conflicts of interest, and are often lead by individuals with their own individual conflicts of interest.    <br /><br />Medical societies, in particular, now often get significant financial support from industry (pharmaceutical, biotechnology, medical device and even health insurance companies).  The societies' leaders are often full-time executives, not necessarily physicians, who may look to their industry sponsors to continue to provide the funds that support nice salaries and luxurious offices.  The society's officers and boards are often dominated by physicians with their own conflicts of interest.  (Look <a href="http://hcrenewal.blogspot.com/search/label/medical%20societies">here</a> for more examples, and see, in particular, <a href="http://hcrenewal.blogspot.com/2007/11/aaos-patient-discussion-guide-regarding.html">the case of the AAOS</a>).<br /><br />Similar conflicts may affect accrediting organizations, <a href="http://hcrenewal.blogspot.com/search/label/health%20care%20foundations">health care foundations</a>, and especially academic medical institutions, as we have profusely discussed.  (Look at our posts on <a href="http://hcrenewal.blogspot.com/search/label/conflicts%20of%20interest">conflicts of interest</a>, and <a href="http://hcrenewal.blogspot.com/search/label/institutional%20conflicts%20of%20interest">institutional conflicts of interest</a>.)<br /><br />So if physicians really want to address what is making them burned out and dissatisfied, they will have to regain control of their own societies, organizations, and academic institutions, and ensure that these organizations put core values, not revenue generation and providing cushy compensation to their executives, first.   <br /><br /><strong><span style="font-size: x-small;">References</span></strong><br /><br /><span style="font-size: x-small;">1.  Shanafelt TD, Boone S, Tan et al. Burnout and satisfaction with work-life balance among US physicians relative to the general US population.  Arch Intern Med 2012; available online </span><a href="http://archinte.jamanetwork.com/article.aspx?articleid=1351351"><span style="font-size: x-small;">here</span></a><span style="font-size: x-small;">.</span><br /><span style="font-size: x-small;">2.    cited in Schroeder SA. The troubled profession: is medicine's glass half full or half empty? Ann Intern Med 1992; 116:583-592. </span><br /><span style="font-size: x-small;">3. Massachusetts Medical Society. Physician satisfaction survey (2001). Link </span><a href="http://www.massmed.org/AM/PrinterTemplate.cfm?Section=Home6&TEMPLATE=/CM/ContentDisplay.cfm&CONTENTID=2504"><span style="font-size: x-small;">here</span></a><span style="font-size: x-small;">.</span><br /><span style="font-size: x-small;">4.  Kaiser Family Foundation. National survey of physicians - part III: doctors' opinions about their profession.  Link </span><a href="http://www.kff.org/kaiserpolls/upload/Highlights-and-Chart-Pack-2.pdf"><span style="font-size: x-small;">here</span></a><span style="font-size: x-small;">.</span><br /><span style="font-size: x-small;">5.  Merritt Hawkins & Associates. 2007 survey of primary care physicians.  Link </span><a href="http://www.merritthawkins.com/pdf/2007_survey_primarycare.pdf"><span style="font-size: x-small;">here</span></a><span style="font-size: x-small;">.</span><br /><span style="font-size: x-small;">6. Poses MD. A cautionary tale: the dysfunction of American health care.  Eur J Int Med 2003; 14: 123-130.  Link </span><a href="http://www.ejinme.com/article/S0953-6205%2803%2900029-3/abstract"><span style="font-size: x-small;">here</span></a><span style="font-size: x-small;">.</span><br /><span style="font-size: x-small;">7.Pololi L, Kern DE, Carr P, et al. The culture of academic medicine: faculty perceptions of the lack of alignment between individual and institutional values. J Gen Intern Med 2009; 24: 1289-95. Link </span><a href="http://www.med.upenn.edu/focus/user_documents/CultureofAcademicMedicine_Pololijgim.pdf"><span style="font-size: x-small;">here.</span></a><br /><span style="font-size: x-small;">8.  Poses RM, Smith WR. Faculty values. J Gen Intern Med 2010; 25: 646. Link </span><a href="http://www.ncbi.nlm.nih.gov/pmc/articles/PMC2881965/"><span style="font-size: x-small;">here</span></a><span style="font-size: x-small;">. </span><br /><span style="font-size: x-small;">9. Pololi L, Ash A, Krupat E. Faculty values in the culture of academic medicine: findings of a national faculty survey. Link </span><a href="https://www.aamc.org/download/154216/data/your_career_is_more_than_your_specialty_-_246.pdf"><span style="font-size: x-small;">here</span></a><span style="font-size: x-small;">.</span><br /><span style="font-size: x-small;">10.  Poses RM, Baier-Manwell L, Mundt M, Linzer M. Perceived leadership integrity and physicians’ stress, burnout, and intention to leave practice. J Gen Intern Med 2005; 20: S182.  Link </span><a href="http://onlinelibrary.wiley.com/doi/10.1111/jgi.2005.20.issue-S1/issuetoc"><span style="font-size: x-small;">here</span></a><span style="font-size: x-small;">.</span>

Will Another Study on Physician Burnout Finally Lead to Addressing its Causes?

The latest article on physician burnout has actually attracted some media attention.  e.g., here and here.The Latest ArticleThe article was a survey of physicians in all specialties with over 7000 res…

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Productive Employment

With desultory interest, I picked up a 1993 novel at the library, <i>The Surgical Arena</i>, by Peter Grant, M.D., “a former navy pilot who became a surgeon.” The following snippet, on page 18, says a lot in a nutshell:<br /><blockquote class="tr_bq">“We’ve got one shot at getting into medical school and that means getting our grades into the top twenty.”<br /><br />“Why don’t we all just quit and take some gut courses that will prepare us to be brokers,” said Beckwith, one of the veterans. “We can sit on our asses and make a lot of dough.”<br /><br />“You have to be a crook to be successful in that field,” said Norman. “Besides, you’ll never get any satisfaction out of life unless you put something worthwhile back into it.  I didn’t fight in the infantry to come back and become a broker.”</blockquote><br />1993 was the same year that a short-sighted Congress cancelled the Texas supercollider project.  It’s <a href="http://www.salemnews.com/opinion/x1058727128/Higgs-discovery-highlights-a-missed-opportunity-here/print" target="_blank">been correctly noted</a> that had that not happened, the recent Higgs-Boson particle observation might have occurred here rather than in Switzerland.  A number of the now-unemployed physicists involved were hired by Wall Street firms.<br /><br />Although basic banking DOES perform a socially useful function -- firms and individuals DO need capital -- it is very questionable what if anything “banking innovations” (CDOs, derivatives, very rapid short-term computerized trading, etc.) that have proliferated since 1993 have contributed to society.   As <a href="http://www.telegraph.co.uk/finance/comment/rogerbootle/6316529/Does-banking-contribute-to-the-good-of-society.html%20%20" target="_blank">Roger Bootle wrote</a>:<br /><blockquote class="tr_bq">For m]uch of what goes on in financial markets . . . [t]he gains to one party reflect the losses to another, and the vast fees and charges racked up in the process end up being paid by Joe Public, since even if he is not directly involved in the deals, he is indirectly through the costs and charges that he pays for goods and services.</blockquote><br />In 1995, the assets of the six largest bank holding companies was no more than 17% of GDP, but at the end of 2010, the assets of the six largest bank holding companies were valued at  just over 63 percent of GDP. This financialization of the economy has been <a href="http://baselinescenario.com/2012/02/29/why-is-finance-so-big/" target="_blank">at the expense of the rest of us</a>. And finance is now the top area where graduates of Ivy League universities find jobs.<br /><br />As Dale Carnegie points out, all people – even gangsters like Al Capone – think of themselves as “good guys”.  Lloyd Blankfein, Goldman Sachs’ CEO, is probably sincere when he says he is “doing God’s work”.  But many of us do not agree. Things work as well as they do only because many people<i> are</i> actually still working hard at useful jobs that <i>do</i> contribute to society.  My thanks go to those – and not to the so-called “wealth creators.”

Productive Employment

With desultory interest, I picked up a 1993 novel at the library, The Surgical Arena, by Peter Grant, M.D., “a former navy pilot who became a surgeon.” The following snippet, on page 18, says a lot in…

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"Replace the RUC!"

We have frequently posted, first <a href="http://hcrenewal.blogspot.com/2007/03/on-disparities-between-reimbursement-of.html">here in 2007</a>, and more recently <a href="http://hcrenewal.blogspot.com/2010/07/primary-care-and-hc-renewal-ruc-kus.html">here</a> and <a href="http://hcrenewal.blogspot.com/2010/06/ruc-off-new-england-journal-once-again.html">here</a>, about the little-known group that controls how the US Medicare system pays physicians, the RBRVS Update Committee, or RUC. <br /><br />Since 1991, Medicare has set physicians' payments using the Resource Based Relative Value System (RBRVS), ostensibly based on a rational formula to tie physicians' pay to the time and effort they expend, and the resources they consume on particular patient care activities. Although the RBRVS was meant to level the payment playing field for cognitive services, including primary care vs procedures, over time it has had the opposite effect, as explained by Bodenheimer et al in a 1997 article in the Annals of Internal Medicine.(1) A system that pays a lot for procedures, but much less for diagnosing illnesses, forecasting prognoses, deciding on treatment, and understanding patients' values and preferences when procedures and devices are not involved, is likely to be very expensive, but not necessarily very good for patients. <br /><br />As we <a href="http://hcrenewal.blogspot.com/2009/02/what-ruc-again-one-of-worlds-most.html">wrote before</a>, to update the system, the Center for Medicare and Medicaid Services (CMS) relies almost exclusively on the advice of the <a href="http://www.ama-assn.org/ama/pub/physician-resources/solutions-managing-your-practice/coding-billing-insurance/medicare/the-resource-based-relative-value-scale/the-rvs-update-committee.shtml">RBRVS Update Committee</a>. The RUC is a private committee of the AMA, <a href="http://www.ama-assn.org/ama1/pub/upload/mm/380/toptenthings.pdf">touted</a> as an "expert panel" that takes advantage of the organization's First Amendment rights to petition the government. Membership on the RUC is allotted to represent specialty societies, so that the vast majority of the members represent specialties that do procedures and focus on expensive, high-technology tests and treatments. However, the identities of RUC members are opaque, and the proceedings of the group are secret.<br /><br />To expand on the penultimate point, <a href="http://www.ama-assn.org/ama/pub/physician-resources/solutions-managing-your-practice/coding-billing-insurance/medicare/the-resource-based-relative-value-scale/the-rvs-update-committee.shtml">the current page on the AMA web-site that describes the RUC</a> only lists its members in terms of their specialties and organizational affiliation. Their names do not appear. A <a href="http://www.ama-assn.org/ama1/pub/upload/mm/380/posesresponse.pdf">response</a> to a <a href="http://hcrenewal.blogspot.com/2009/02/what-ruc-again-one-of-worlds-most.html">previous post</a> by me on the subject by the then Chair and Chair-Elect of the RUC suggested that the RUC membership is not quite secret. They stated that "a list of the individual members of the RUC is published in the AMA publication, Medicare RBRVS 2009: The Physicians Guide." This publication is available from the AMA <a href="https://catalog.ama-assn.org/Catalog/product/product_detail.jsp?productId=prod1170041">here</a> for a mere $71.95 (although now with the notation that the product has been "discontinued.") However, the book is not on the web, or in my local or university library, and I have no other way to easily access it. Thus, the RUC membership is at best relatively opaque.<br /><br />To expand on the ultimate point, as Goodson(2) noted, RUC "meetings are closed to outside observers except by invitation of the chair." Furthermore, he stated, "proceedings are proprietary and therefore not publicly available for review."<br /><br />The fog surrounding the operations of the RUC seems to have affected many who write about it. We have posted (<a href="http://hcrenewal.blogspot.com/2007/12/is-sustainable-growth-rate-main-problem.html">here</a>, <a href="http://hcrenewal.blogspot.com/2008/07/can-we-fix-medicare-while-pretending.html">here</a>, <a href="http://hcrenewal.blogspot.com/2008/12/no-such-ruc-new-england-journal-takes.html">here</a>, and <a href="http://hcrenewal.blogspot.com/2010/06/ruc-off-new-england-journal-once-again.html">here</a>) about how previous publications about problems with incentives provided to physicians seemed to have avoided even mentioning the RUC. Up until 2010, after the US recent attempt at health care reform, the RUC seemed to remain the great unmentionable. Even the leading US medical journal seemed reluctant to even print its name.<br /><br />That <a href="http://hcrenewal.blogspot.com/2010/10/ruc-it-up-how-us-government-fixes.html">changed</a> in October, 2010.  A combined effort by the Wall Street Journal, the Center for Public Integrity, and Kaiser Health News yielded two major articles about the RUC, <a href="http://online.wsj.com/article/SB10001424052748704657304575540440173772102.html">here</a> in the WSJ (also with two more spin-off articles), and <a href="http://www.publicintegrity.org/articles/entry/2571/">here </a>from the Center for Public Integrity (also <a href="http://www.kaiserhealthnews.org/Stories/2010/October/27/AMA-center-public-integrity.aspx">reprinted</a> by Kaiser Health News.) The articles covered the main points about the RUC: its de facto control over how physicians are paid, its "secretive" nature (quoting the WSJ article), how it appears to favor procedures over cognitive physician services, etc.<br /><br />So the RUC became less anechoic.  Now, four months later, there is more news.  A <a href="http://replacetheruc.org/">new site</a> called "Replace the RUC!" has now appeared, with the following introduction:<br /><blockquote>This site has been developed - see here for our backgrounds - to help primary care physicians and other interested individuals obtain verifiable background from reputable sources on:<br /><br />* The evolution and structure of the US' medical payment system.<br />* How it came to devalue primary care and favor specialty services.<br />* How that has translated to lower quality care at far greater expense in the US.<br /><br />We believe the overwhelming majority of American primary care physicians are deeply frustrated with the differences in how primary and specialty care are valued by the current system, and the havoc that system has wrought throughout health care and the nation.<br /><br />The first step to remedying this situation is for the primary care medical societies to visibly and loudly withdraw from participation in the RUC, de-legitimizing the process.<br /><br />That said, this effort is most decidedly NOT primarily about getting primary care physicians more money, but bringing our health system back into homeostasis.</blockquote><br />We have previously noted that there are many unanswered questions about the RUC:<br /><ul><li>How did the government come to fix the payments physicians receive? Government price-fixing has not been popular in the US, yet this has caused no outcry.</li><li>Why is the process by which they are fixed allowed to be so opaque and unaccountable? Why are there no public hearings on the updates, and why is there no input from practicing physicians or organizations other than those related to the RUC?</li><li>How did the RUC become de facto in charge of this process?</li><li>Why does the AMA keep the membership of the RUC so opaque, and give no input into the RUC process to its general membership?</li><li>Why is the RUC membership so dominated by procedural specialists? Why were primary care physicians, who made up at least a sizable minority of physicians when the update process was started, not represented according to their numbers?</li><li>Why has there been so little discussion of the RUC and its responsibility for an extremely expensive health care system dominated by high-technology, expensive, risky and invasive procedures?</li></ul>We welcome this new site as a way to answer these questions, and more importantly, as a way to develop more rational incentives within the health care system.<br /><br />Note that "Replace the RUC!" will be added to our link list.<br /><br /><span style="font-size: x-small;">References</span><br /><span style="font-size: x-small;"></span><br /><span style="font-size: x-small;"><br /></span><br /><span style="font-size: x-small;">1. Bodenheimer T, Berenson RA, Rudolf P. The primary care-specialty income gap: why it matters. Ann Intern Med 2007; 146: 301-306. (Link </span><a href="http://www.annals.org/content/146/4/301.full"><span style="font-size: x-small;">here</span></a><span style="font-size: x-small;">.)</span><br /><span style="font-size: x-small;">2. Goodson JD. Unintended consequences of Resource-Based Relative Value Scale reimbursement. JAMA 2007; 298(19):2308-2310. (Link </span><a href="http://jama.ama-assn.org/cgi/content/short/298/19/2308"><span style="font-size: x-small;">here</span></a><span style="font-size: x-small;">.)</span>

"Replace the RUC!"

We have frequently posted, first here in 2007, and more recently here and here, about the little-known group that controls how the US Medicare system pays physicians, the RBRVS Update Committee, or RU…

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RUC It Up - How the US Government Fixes Physicians' Payments Becomes Less Anechoic

We have frequently posted, first <a href="http://hcrenewal.blogspot.com/2007/03/on-disparities-between-reimbursement-of.html">here in 2007</a>, and most recently <a href="http://hcrenewal.blogspot.com/2010/07/primary-care-and-hc-renewal-ruc-kus.html">here</a> and <a href="http://hcrenewal.blogspot.com/2010/06/ruc-off-new-england-journal-once-again.html">here</a>, about the little-known group that controls how the US Medicare system pays physicians, the RBRVS Update Committee, or RUC.  <br /><br />Since 1991, Medicare as set physicians' payments using the Resource Based Relative Value System (RBRVS), ostensibly based on a rational formula to tie physicians' pay to the time and effort the expend, and the resources they consume on particular patient care activities.  Although the RBRVS was meant to level the payment playing field for cognitive services, including primary care, vs procedures, over time it has had the opposite effect, as explained by Bodenheimer et al in a 1997 article in the Annals of Internal Medicine.(1)  A system that pays a lot for procedures, but much less for diagnosing illnesses, forecasting prognoses, deciding on treatment, understanding patients' values and preferences, when procedures and devices are not involved, is likely to be very expensive, but not necessarily very good for patients.  <br /><br />As we <a href="http://hcrenewal.blogspot.com/2009/02/what-ruc-again-one-of-worlds-most.html">wrote before</a>, to update the system, the Center for Medicare and Medicaid Services (CMS) relies almost exclusively on the advice of the <a href="http://www.ama-assn.org/ama/pub/physician-resources/solutions-managing-your-practice/coding-billing-insurance/medicare/the-resource-based-relative-value-scale/the-rvs-update-committee.shtml">RBRVS Update Committee</a>. The RUC is a private committee of the AMA, <a href="http://www.ama-assn.org/ama1/pub/upload/mm/380/toptenthings.pdf">touted</a> as an "expert panel" that takes advantage of the organization's First Amendment rights to petition the government. Membership on the RUC is allotted to represent specialty societies, so that the vast majority of the members represent specialties that do procedures and focus on expensive, high-technology tests and treatments. However, the identities of RUC members are opaque, and the proceedings of the group are secret.<br /><br /><br />To expand on the penultimate point, the <a href="http://www.ama-assn.org/ama/pub/physician-resources/solutions-managing-your-practice/coding-billing-insurance/medicare/the-resource-based-relative-value-scale/the-rvs-update-committee.shtml">current page on the AMA web-site</a> that describes the RUC only lists its members in terms of their specialties and organizational affiliation. Their names do not appear. A <a href="http://www.ama-assn.org/ama1/pub/upload/mm/380/posesresponse.pdf">response</a> to a <a href="http://hcrenewal.blogspot.com/2009/02/what-ruc-again-one-of-worlds-most.html">previous post</a> by me on the subject by the then Chair and Chair-Elect of the RUC suggested that the RUC membership is not quite secret. They stated that "a list of the individual members of the RUC is published in the AMA publication, Medicare RBRVS 2009: The Physicians Guide." This publication is available from the AMA <a href="https://catalog.ama-assn.org/Catalog/product/product_detail.jsp?productId=prod1170041">here </a>for a mere $71.95. However, the book is not on the web, or in my local or university library, and I have no other way to easily access it. Thus, the RUC membership as at best relatively opaque.<br /><br />To expand on the ultimate point, as Goodson(2) noted, RUC "meetings are closed to outside observers except by invitation of the chair." Furthermore, he stated, "proceedings are proprietary and therefore not publicly available for review."<br /><br />The fog surrounding the operations of the RUC seems to have affected many who write about. We have posted (<a href="http://hcrenewal.blogspot.com/2007/12/is-sustainable-growth-rate-main-problem.html">here</a>, <a href="http://hcrenewal.blogspot.com/2008/07/can-we-fix-medicare-while-pretending.html">here</a>, <a href="http://hcrenewal.blogspot.com/2008/12/no-such-ruc-new-england-journal-takes.html">here</a>, and <a href="http://hcrenewal.blogspot.com/2010/06/ruc-off-new-england-journal-once-again.html">here</a>) about how previous publications about problems with incentives provided to physicians seemed to have avoided even mentioning the RUC. Up until now in 2010, after the US recent attempt at health care reform, the RUC seems to remain the great unmentionable. Even the leading US medical journal seems reluctant to even print its name. <br /><br />That has just changed.  A combined effort by the Wall Street Journal, the Center for Public Integrity, and Kaiser yielded two major articles about the RUC, <a href="http://online.wsj.com/article/SB10001424052748704657304575540440173772102.html">here</a> in the WSJ (also with two more spin-off articles), and <a href="http://www.publicintegrity.org/articles/entry/2571/">here</a> from the Center for Public Integrity (also <a href="http://www.kaiserhealthnews.org/Stories/2010/October/27/AMA-center-public-integrity.aspx">reprinted </a>by Kaiser Health News.)  The articles cover the main points about the RUC: its de facto control over how physicians are paid, its "secretive" nature (quoting the WSJ article), how it appears to favor procedures over cognitive physician services, etc.<br /><br />So the RUC has suddenly become less anechoic.<br /><br />However, despite the best efforts of some very good investigative reporters, there still are important unanswered questions, questions we have <a href="http://hcrenewal.blogspot.com/2010/06/ruc-off-new-england-journal-once-again.html">raised before</a>:<br /><div></div><div></div><ul><li>How did the government come to fix the payments physicians receive? Government price-fixing has not been popular in the US, yet this has caused no outcry.</li><li>Why is the process by which they are fixed allowed to be so opaque and unaccountable? Why are there no public hearings on the updates, and why is there no input from practicing physicians or organizations other than those related to the RUC?</li><li>How did the RUC become de facto in charge of this process?</li><li>Why does the AMA keep the membership on the RUC so opaque, and give no input into the RUC process to its general membership?</li><li>Why is the RUC membership so dominated by procedural specialists? Why were primary care physicians, who made up at least a sizable minority of physicians when the update process was started, not represented according to their numbers?</li><li>Why has there been so little discussion of the RUC and its responsibility for an extremely expensive health care system dominated by high-technology, expensive, risky and invasive procedures?</li></ul>Without discussing how the incentives for physicians became so unbalanced, do we really expect we can fix them?  If we do not fix them, do we really think we can "bend the cost curve?"  If we do not control our costs, do we really think that we will be able to make good health care accessible for all?  At least now I can say that the issue may really be in play for health care professionals, health care policy experts, and the public at large.<br />See also comments on other blogs: <a href="http://www.medrants.com/archives/5895">DBs Medical Rants</a>, <a href="http://gooznews.com/?p=2012">GoozNews</a>, and <a href="http://www.joepaduda.com/archives/001948.html">Managed Care Matters</a>. <br /><br />ADDENDUM - Additionally, see comments on the <a href="http://mdredux.blogspot.com/2010/10/at-least-some-of-secrecy-of-mysterious.html">Retired Doc's Thoughts blog</a>, and the <a href="http://runningahospital.blogspot.com/2010/10/so-thats-how-rates-are-set.html">Running a Hospital blog</a>. <br /><br /><span style="font-size: x-small;">References</span> <br /><span style="font-size: x-small;">1. Bodenheimer T, Berenson RA, Rudolf P. The primary care-specialty income gap: why it matters. Ann Intern Med 2007; 146: 301-306. (Link </span><a href="http://www.annals.org/content/146/4/301.full"><span style="font-size: x-small;">here</span></a><span style="font-size: x-small;">.)</span> <br /><span style="font-size: x-small;"></span><br /><span style="font-size: x-small;">2. Goodson JD. Unintended consequences of Resource-Based Relative Value Scale reimbursement. JAMA 2007; 298(19):2308-2310. (Link </span><a href="http://jama.ama-assn.org/cgi/content/short/298/19/2308"><span style="font-size: x-small;">here</span></a><span style="font-size: x-small;">.)</span>

RUC It Up - How the US Government Fixes Physicians' Payments Becomes Less Anechoic

We have frequently posted, first here in 2007, and most recently here and here, about the little-known group that controls how the US Medicare system pays physicians, the RBRVS Update Committee, or RU…

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Forest Pharmaceuticals Pleads Guilty to Obstruction of Justice, No Individual Pays Any Penalty

The parade of legal settlements marches on.  The latest story is about Forest Laboratories and its marketing of Celexa (citalopram ) and Levothyroid (l-thyroxin).  Here is the most <a href="http://www.nytimes.com/2010/09/16/health/16drug.html">complete version</a>, courtesy of Natasha Singer reporting for the New York Times. First, the lead sentence:<br /><blockquote>A unit of Forest Laboratories, the maker of the antidepressant Celexa, <em>agreed on Wednesday to pay more than $313 million to settle criminal and civil complaints</em>, including a claim that it had illegally promoted the drug for use in children. </blockquote><br />Here are the charges:<br /><blockquote>Among the criminal charges was one that <em>the subsidiary, Forest Pharmaceuticals, marketed Celexa, which was approved only for adult depression, to treat children and adolescents</em>. The government also claimed that, in conjunction with the company’s off-label promotion, <em>Forest publicized the positive results of a study on Celexa in adolescents while failing to tell doctors about a similar study that had negative results</em>. <br /><br />'Forest Pharmaceuticals deliberately chose to pursue corporate profits over its obligations to the F.D.A. and the American public,' Carmen Ortiz, the United States attorney for the District of Massachusetts, said in a statement Wednesday. <br /><br />In addition, federal prosecutors accused Forest of <em>paying doctors to induce them to prescribe Celexa and another antidepressant, Lexapro.</em> The remuneration included 'cash payments disguised as grants or consulting fees, expensive meals and lavish entertainment, and other valuable goods and services,' the government said in its civil complaint. <br /><br />Among the items that Forest sales representatives gave to doctors from 1998 to 2005, the complaint said, were tickets to St. Louis Cardinal games, which were to be 'leveraged and sold as a reward for prescriptions'; a $1,000 gift certificate to Alain Ducasse, a gourmet French restaurant, for a high-prescribing child psychiatrist; a deep-sea fishing trip off Cape Cod for a doctor and his three sons; $400 in Broadway theater tickets for a doctor and his wife; and Red Sox tickets worth $2,276 to be used for doctors in the Boston area. </blockquote><br />So we not just off-label marketing, but suppression of clinical research (of course, a study whose results were not favorable to the product being marketed), and payments to doctors as an "inducement to prescribe."<br /><br />But wait, there is more:<br /><blockquote>As part of the criminal settlement, Forest Pharmaceuticals, which is based in St. Louis, agreed to <em>plead guilty to one <strong>felony count of obstructing justice</strong>, acknowledging that employees had lied to F.D.A. officials during a plant inspection in 2003</em>. <br /><br />The company also agreed to plead guilty to <em>two misdemeanors</em>, one of which covers the company’s misbranding of Celexa by marketing the antidepressant for use in children from 1998 to 2002. <br /><br />The <em>other misdemeanor covers the illegal distribution from 2001 to 2003 of an unapproved drug, Levothroid,</em> to treat a thyroid hormone deficiency. Such thyroid pills, made by various drug makers, had been sold in the United States since the 1950s without F.D.A. approval. But in 2001, the agency told drug makers that they needed to reduce their distribution of such medications until the companies obtained agency approval to market the pills. <br /><br />The criminal charges accused Forest of making a deliberate decision to continue distributing the drug in quantities exceeding the F.D.A.’s directive. After the agency sent a warning letter to Forest, the company directed employees to work until 1 a.m. to continue shipping as much Levothroid as possible, according to the criminal complaint. </blockquote><br />So there was also obstruction of justice in the form of lying to the FDA, and selling drugs that the FDA had ordered not to be sold.<br /><br />So what are the penalties?<br /><blockquote>The criminal settlement calls for the company to pay a<em> $150 million fine and to forfeit an additional $14 million in assets</em>. Forest will also pay <em>more than $88 million to the federal government and more than $60 million to the states to resolve a civil complaint</em> that its actions caused false claims to be submitted to federal health care programs. In addition, <em>two whistle-blowers will split $14 million from the federal share of the settlement. </em><br /><br />Forest has also entered into a <em>five-year corporate integrity agreement</em>, requiring an independent expert to review the company’s compliance with drug marketing regulations.</blockquote><br />So here we go again. A large drug company was up to no good, suppressing research, paying doctors for their prescriptions, lying to the FDA, and disobeying its orders.<br /><br />The penalty seemed large, over $300 million. However, Celexa was a big revenue generator at the time the events above occurred, topping $1 billion in revenue first in 2002 (per Forbes <a href="http://www.forbes.com/2002/08/15/0815frx.html">here</a>). Furthermore, as <a href="http://www.pharmalot.com/2010/09/forest-labs-pays-313m-for-illegal-marketing">noted by Ed Silverman on Pharmalot</a>, it seems no individual will suffer any negative consequences for authorizing, directing, or implementing the conduct described above. Finally, as best I can tell, despite the fact that a Forest subsidiary will plead guilty to a felony, the company is not going to be barred from doing business with the government.  <br /><br />So, despite pleading guilty to a felony and three misdemeanors, neither Forest as a company nor any individual working for the company will really suffer very much.  On the other hand, the leaders of Forest have been doing very well.  The company's CEO, Howard Solomon, was number 18 on <a href="http://online.wsj.com/public/resources/documents/st_execpay1007_20100725.html">Wall Street Journal list</a> of the 25 highest paid CEOs over the last decade.  His total realized compensation was over $385 million over the last 10 years.  According to<a href="http://services.corporate-ir.net/SEC/Document.Service?id=P3VybD1odHRwOi8vaXIuaW50Lndlc3RsYXdidXNpbmVzcy5jb20vZG9jdW1lbnQvdjEvMDAwMDAzODA3NC0xMC0wMDAwMTYvZG9jL0ZvcmVzdExhYm9yYXRvcmllc0luYy5wZGYmdHlwZT0yJmZuPUZvcmVzdExhYm9yYXRvcmllc0luYy5wZGY="> the company's 2010 proxy statement</a>, his total compensation in 2009 was $8,267,236.  The four other highest paid executives made from just over $2.5 million to $5.3 million.<br /><br />So here we go again.  Another large health care organization has been found to have done wrong, but the only penalty is a fine that whose impact will be diffused across the whole company, and ultimately be paid by its employees, its customers, including patients, and its stockholders.  Meanwhile, the people who authorized, directed, or implemented the wrong doing apparently will pay nothing and receive no negative incentives.  Furthermore, the top leaders of the company, whose huge compensation in the past was increased by the results of the wrong doing, will continue to prosper.<br /><br />As we have said again and again,  we will not deter unethical behavior by health care organizations until the people who authorize, direct or implement bad behavior fear some meaningfully negative consequences. Real health care reform needs to make health care leaders accountable, and especially accountable for the bad behavior that helped make them rich. <br /><br />By the way, the current case offers an avenue for those who do not like what Forest did to ask those who are supposed to be ultimately responsible for its behavior how this was allowed to happen.  The board of directors of the company is supposed to be ultimately accountable for the company's actions.  As we have noted before, these directors are supposed to "demonstrate unyielding loyalty to the company's shareholders." [Per Monks RAG, Minow N. <a href="http://www.amazon.com/Corporate-Governance-Robert-G-Monks/dp/1405116986">Corporate Governance</a>, 3rd edition. Malden, MA: Blackwell Publishing, 2004. P.200.] <br /><br />The current directors of Forest Laboratories, according to <a href="http://services.corporate-ir.net/SEC/Document.Service?id=P3VybD1odHRwOi8vaXIuaW50Lndlc3RsYXdidXNpbmVzcy5jb20vZG9jdW1lbnQvdjEvMDAwMDAzODA3NC0xMC0wMDAwMTYvZG9jL0ZvcmVzdExhYm9yYXRvcmllc0luYy5wZGYmdHlwZT0yJmZuPUZvcmVzdExhYm9yYXRvcmllc0luYy5wZGY=">the company's 2010 proxy statement</a>, include <a href="http://connects.catalyst.harvard.edu/profiles/profile/person/24377">Dr Nesli Basgoz</a>, "Associate Chief for Clinical Affairs, Division of Infectious Diseases, Massachusetts General Hospital (MGH)," and "Associate Professor of Medicine at Harvard Medical School."  Also, it includes<a href="http://www.mountsinai.org/profiles/lester-b-salans?id=0000072500001497265082"> Dr Lester B Salans</a>, "Clinical Professor" at Mount Sinai Medical School, not to mention <a href="http://connects.catalyst.harvard.edu/profiles/profile/person/48486">Dr Peter J Zimetbaum</a>, "Director of Clinical Cardiology" at Beth Israel Deaconess Medical Center in Boston (BIDMC), and "Associate Professor of Medicine at Harvard Medical School."   Maybe some enterprising student journalist will get to ask the good doctors how they let things at Forest get so ethically out of hand.

Forest Pharmaceuticals Pleads Guilty to Obstruction of Justice, No Individual Pays Any Penalty

The parade of legal settlements marches on.  The latest story is about Forest Laboratories and its marketing of Celexa (citalopram ) and Levothyroid (l-thyroxin).  Here is the most complete version, c…

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RUC Off - the New England Journal Once Again Fails to Mention the Unmentionable

Last week, the influential New England Journal of Medicine published an article by Bruce Vladek entitled "Fixing Medicare's Physician Payment System."(1)  Although only identified as working for Nexara, a health consulting business, Mr Vladek was a <a href="http://www.leighbureau.com/speaker.asp?id=128">former administrator</a> of what was then called the Health Care Financing Administration (HCFA) of the US Department of Health and Human Services (DHHS), the part of the department that then ran the US Medicare program.  Vladek thus can reasonably be viewed as an expert on Medicare.  <br /><br />Vladek identified two main problems with the current way physicians are paid by Medicare.  First, <br /><blockquote>Medicare is captive to an arbitrary, if elegantly conceived, formula for total payments to physicians — the sustainable growth rate (SGR). In the alternate reality of the Congressional budget process, the SGR will reduce Medicare's physician payments, which already trail those from private insurers, as far into the future as the eye can see.</blockquote><br />Second,<br /><blockquote>there is widespread consensus that the <em>relative fees in the current system are a significant cause of the growing imbalance in supply and utilization between primary care and specialty services in the U.S. health care system. That imbalance, in turn, is widely perceived as a major cause of both excessive costs and inadequate quality of care</em>. This is not just a Medicare problem: the Medicare Resource-Based Relative Value Scale is used by most private insurers to set relative prices for physicians.</blockquote><br />Vladek expanded on the second point as follows<br /><blockquote>the basic mechanics of the Medicare Physician Fee Schedule, which was supposed to change physician payment to increase rewards for primary care services at the expense of procedural and interventional services, appears to have gone totally off track. <em><strong>For various reasons</strong>, the fee schedule, which originally did increase the prices of evaluation and management services relative to those of surgery or invasive procedures, turned in the other direction <strong>through the process of annual updating of relative value units</strong></em>. Surgeons, radiologists, and some medical specialists are now paid two to three times as much per hour as providers of cognitive services, which is about where we began 20 years ago; this was the situation that the fee schedule was supposed to fix.<br /><br />The question of the relative virtues of primary versus specialty care can be debated ad nauseam, but in other wealthy countries that serve their populations at least as well as we do, the ratio of primary care physicians to specialists is much higher than in the United States, and the gap in compensation is much smaller or the poles even reversed. <em>Young physicians, burdened by increasing educational debts, may well choose a career path on the basis of a major difference in compensation, especially when the better-compensated positions require less ongoing responsibility for patients and offer better working hours</em>.</blockquote><br />This is about all that Vladek wrote about how the imbalance between how Medicare pays for primary care and other "cognitive services," and for procedures came about. Vladek, and many others have argued that this imbalance has lead to strong financial incentives that have been slowly destroying primary care, and strong incentives that have lead to the use of too many procedures, both strong drivers of rising costs in the most expensive health care system in the world.<br /><br />Vladek noted vaguely that "through various reasons," the incentives were imbalanced by "the process of annual updating of relative value units."<br /><br />However, as we have discussed in several blog posts, a lot more is known about how this process got "totally off track."<br /><br />In fact, in 2007, an article by Bodenheimer et al in the Annals of Internal Medicine explained the problems in considerably more detail.(2)  As we <a href="http://hcrenewal.blogspot.com/2007/03/on-disparities-between-reimbursement-of.html">wrote then</a>, Its main points included <br /><ul><li>Proceduralists are often able to learn how to do their procedures more quickly, and thus increase the volume of procedures done, while office and hospital visits can only be sped up so much.</li><li>The process used to update the RBRVS system is biased towards procedures for three main reasons: 1. "specialty society influence in proposing RVU [relative value unit] increases," 2. the specialist-heavy RUC [Relative Value Scale Update Committee] membership," and 3. "the desire of RUC specialists to avoid increases in evaluation and management [that is, cognitive, or non-procedural] RVUs."</li><li>Medicare now uses a formula to limit increases in overall spending. The use of this formula leads to across the board cuts in all reimbursements. Since cognitive services reimbursements were never high to begin with, and have rarely been individually increased, these cuts tend to have disproportionate decreases.</li><li>Private insurers and managed care organizations tend to follow Medicare's lead in their reimbursement procedures, but tend to tilt the playing field even more in favor of procedures versus cognitive services. Several studies showed that such payers paid more for procedures than did Medicare, but about the same for office and hospital visits.</li></ul>The role of the RBRVS Update Committee (RUC) is complex and in many ways mysterious.  As we <a href="http://hcrenewal.blogspot.com/2009/02/what-ruc-again-one-of-worlds-most.html">wrote before</a>, to update the system, the Center for Medicare and Medicaid Services (CMS) relies almost exclusively on the advice of the <a href="http://www.ama-assn.org/ama/pub/physician-resources/solutions-managing-your-practice/coding-billing-insurance/medicare/the-resource-based-relative-value-scale/the-rvs-update-committee.shtml">RBRVS Update Committee</a>. The RUC is a private committee of the AMA, <a href="http://www.ama-assn.org/ama1/pub/upload/mm/380/toptenthings.pdf">touted</a> as an "expert panel" that takes advantage of the organization's First Amendment rights to petition the government. Membership on the RUC is allotted to represent specialty societies, so that the vast majority of the members represent specialties that do procedures and focus on expensive, high-technology tests and treatments. However, the identities of RUC members are opaque, and the proceedings of the group are secret.<br /><br />To expand on the penultimate point, the <a href="http://www.ama-assn.org/ama/pub/physician-resources/solutions-managing-your-practice/coding-billing-insurance/medicare/the-resource-based-relative-value-scale/the-rvs-update-committee.shtml">current page</a> on the AMA web-site that describes the RUC only lists its members in terms of their specialties and organizational affiliation.  Their names do not appear.  A <a href="http://www.ama-assn.org/ama1/pub/upload/mm/380/posesresponse.pdf">response </a>to a <a href="http://hcrenewal.blogspot.com/2009/02/what-ruc-again-one-of-worlds-most.html">previous post</a> by me on the subject by the then Chair and Chair-Elect of the RUC suggested that the RUC membership is not quite secret. They stated that "a list of the individual members of the RUC is published in the AMA publication, Medicare RBRVS 2009: The Physicians Guide." This publication is available from the AMA <a href="https://catalog.ama-assn.org/Catalog/product/product_detail.jsp?productId=prod1170041">here</a> for a mere $71.95. However, the book is not on the web, or in my local or university library, and I have no other way to easily access it.  Thus, the RUC membership as at best relatively opaque.<br /><br />To expand on the ultimate point, as Goodson(3) noted, RUC "meetings are closed to outside observers except by invitation of the chair." Furthermore, he stated, "proceedings are proprietary and therefore not publicly available for review."<br /><br />The fog surrounding the operations of the RUC seems to have affected many who write about.  We have posted (<a href="http://hcrenewal.blogspot.com/2007/12/is-sustainable-growth-rate-main-problem.html">here</a>, <a href="http://hcrenewal.blogspot.com/2008/07/can-we-fix-medicare-while-pretending.html">here</a>, and <a href="http://hcrenewal.blogspot.com/2008/12/no-such-ruc-new-england-journal-takes.html">here</a>) about how previous publications about problems with incentives provided to physicians seemed to have avoided even mentioning the RUC.  In 2010, post the US recent attempt at health care reform, the RUC seems to remain the great unmentionable.  Even the leading US medical journal seems reluctant to even print its name.  <br /><br />Thus, as we <a href="http://hcrenewal.blogspot.com/2008/12/no-such-ruc-new-england-journal-takes.html">noted before</a>, however, the mysteries about it remain:<br /><ul><li>How did the government come to fix the payments physicians receive? Government price-fixing has not been popular in the US, yet this has caused no outcry.</li><li>Why is the process by which they are fixed allowed to be so opaque and unaccountable? Why are there no public hearings on the updates, and why is there no input from practicing physicians or organizations other than those related to the RUC?</li><li>How did the RUC become de facto in charge of this process?</li><li>Why does the AMA keep the membership on the RUC so opaque, and give no input into the RUC process to its general membership?</li><li>Why is the RUC membership so dominated by procedural specialists? Why were primary care physicians, who made up at least a sizable minority of physicians when the update process was started, not represented according to their numbers?</li><li>Why has there been so little discussion of the RUC and its responsibility for an extremely expensive health care system dominated by high-technology, expensive, risky and invasive procedures?</li></ul>Without discussing how the incentives for physicians became so unbalanced, do we really expect we can fix them?  In this case, the persistence of the <a href="http://hcrenewal.blogspot.com/search/label/anechoic%20effect">anechoic effect</a> seems to be doing real damage to the discussion of the critical issues we in the US face today.<br /><span style="font-size: x-small;">References</span><br /><span style="font-size: x-small;"><br /></span><br /><span style="font-size: x-small;">1. Vladek B. Fixing Medicare's physician payment system. N Engl J Med 2010; 362:1955-1957. (Link </span><a href="http://content.nejm.org/cgi/content/full/NEJMp1004709"><span style="font-size: x-small;">here</span></a><span style="font-size: x-small;">.)</span><br /><span style="font-size: x-small;">2. Bodenheimer T, Berenson RA, Rudolf P. The primary care-specialty income gap: why it matters. Ann Intern Med 2007; 146: 301-306. (Link </span><a href="http://www.annals.org/content/146/4/301.full"><span style="font-size: x-small;">here.</span></a><span style="font-size: x-small;">)</span><br /><span style="font-size: x-small;">3. Goodson JD. Unintended consequences of Resource-Based Relative Value Scale reimbursement. JAMA 2007; 298(19):2308-2310.  (Link </span><a href="http://jama.ama-assn.org/cgi/content/short/298/19/2308"><span style="font-size: x-small;">here</span></a><span style="font-size: x-small;">.)</span>

RUC Off - the New England Journal Once Again Fails to Mention the Unmentionable

Last week, the influential New England Journal of Medicine published an article by Bruce Vladek entitled "Fixing Medicare's Physician Payment System."(1)  Although only identified as working for Nexar…

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The Role of the RUC in Medicare's Price-Fixing and Rationing Remains Anechoic

An important part of the noisy and contentious debate about health care reform in the US centers on the role of the government as a provider of health insurance. Some on the left want a government "single-payer" plan to be the only health insurance available. Some left of center want a government "public option" health insurance plan to be available, particularly to those who have trouble obtaining commercial insurance. Some on the right want none of it, and sometimes note that the existing government single-payer plan for the elderly and disabled, Medicare, has important faults that would only become more significant if the plan is extended or duplicated. Yet even critics of Medicare on the right do not seem to want to talk about what may be its worst fault.<br /><br />The latest example, an <a href="http://online.wsj.com/article/SB20001424052970204488304574435464052451436.html">op-ed piece by Dr Scott Gottlieb</a>, appeared in the Wall Street Journal yesterday. Dr Gottlieb's main point was that health care rationing by either government or private insurers is inevitable, but that "government does it in far more byzantine and arbitrary ways." In particular,<br /><br /><blockquote>Consider the $450 billion Medicare program. It provides a model for—indeed its bureaucracy could well end up running—the 'public option' health plan that Mr. Obama wants to offer all Americans under the age of 65. In recent years, Medicare's staff has been aggressively restricting coverage for costly treatments.<br /><br />This often means limiting access to the costliest technologies. To do this Medicare relies on its rationing and pricing systems. </blockquote><br />Gottlieb then cited several examples, "tortured decisions concerning the use of implantable defibrillators," and "the travails of the pharmaceutical company Spracor and its drug Xopenex, an innovative respiratory medicine that competes with the chemically distinct and much cheaper generic albuterol."<br /><br />Finally Gottlieb decried Medicare's decision making processes applied to costly technologies as "impenetrable." His summation was<br /><blockquote><br />There's nothing inherently wrong with a program like Medicare seeking value for taxpayers. But it shouldn't make up the rules as it goes.<br /></blockquote><br /><br />Let me first say that I actually agree with Dr Gottlieb's main points. Any government or private health insurance plan ought to seek value for its money. However, how it does so ought to be rational, based on understanding of medicine and the clinical context, and transparent and accountable to the patients on whose behalf such plans pay. "Covert rationing" (as has been well discussed in the <a href="http://covertrationingblog.com/">Covert Rationing Blog</a>) raises worries that decisions are being made just to save money, not to improve value, and even that decisions are being made without informed consideration of the clinical context, or based on the self-interest of the decision makers, or even that decisions may result from bribery and corruption.<br /><br />But if Dr Gottlieb is so concerned about Medicare rationing care as a result of opaque and unaccountable decision making, why is he not more concerned about how Medicare controls the prices of physicians' services than about its decisions about a few expensive, high-tech and infrequently used treatments?<br /><br />We have written again and again about how Medicare has allowed decisions about what physicians are paid for providing various services to be made de facto by an opaque private committee run by the American Medical Association. This decision-making process has lead to relatively generous payments for procedures, versus miserly payments for "cognitive services," (that is, "evaluation and management services," or for physicians interviewing, examining, and counseling patients, making diagnoses, predicting prognoses, and making decisions about treatment.) The resulting perverse incentives are a major reason that primary care has become increasingly unavailable, and for our expensive patterns of care dominated by high-technology and invasive procedures. More detail quoted from <a href="http://hcrenewal.blogspot.com/2009/06/letter-from-ruc-and-my-reply.html">a previous post </a>appears below.<br /><br /><blockquote><p>As we have discussed, the US Medicare system determines what it pays physicians using the <a href="http://www.ama-assn.org/ama/pub/physician-resources/solutions-managing-your-practice/coding-billing-insurance/medicare/the-resource-based-relative-value-scale/overview-of-rbrvs.shtml">Resource Based Relative Value System (RBRVS)</a>. This system determines the pay for every kind of medical encounter according to a complex formula that is supposed to account for physicians' time and effort, physicians' practice expense, and the cost of malpractice insurance. The components of physicians' effort assessed are, in turn, technical skill and physical effort; the required mental effort and judgment; and stress due to the potential risk to the patient.</p><p>To keep the system, which was started in 1990, current, requires addition of new kinds of encounters, which means encounters involving new kinds of procedures, and updating of the estimates of various components, including physicians' time and effort. To do so, the Center for Medicare and Medicaid Services (CMS) relies almost exclusively on the advice of the RBRVS Update Committee (RUC). The <a href="http://www.ama-assn.org/ama/pub/physician-resources/solutions-managing-your-practice/coding-billing-insurance/medicare/the-resource-based-relative-value-scale/the-rvs-update-committee.shtml">RUC</a> is a private committee of the AMA, touted as an "expert panel" that takes advantage of the organization's First Amendment rights to petition the government. Membership on the RUC is allotted to represent specialty societies, so that the vast majority of the members represent specialties that do procedures and focus on expensive, high-technology tests and treatments. However, the identities of RUC members are secret, as are the proceedings of the group.</p><p>This opaque and unaccountable process has resulted in increases outstripping inflation in fees paid for procedures, while fees paid for 'cognitive" medicine,' i.e., for primary care, and for services that involve diagnosis, management of acute and chronic disease, counseling, coordination of care, etc, but not procedures, have lagged inflation. The effects of the RUC have been amplified by the unexplained tendency of commercial managed care and health insurance to track the RBRVS system when making their own payments to physicians.For further details about the RUC, see these posts on Health Care Renewal (<a href="http://hcrenewal.blogspot.com/2007/03/on-disparities-between-reimbursement-of.html">here</a>, <a href="http://hcrenewal.blogspot.com/2007/12/is-sustainable-growth-rate-main-problem.html">here</a>, <a href="http://hcrenewal.blogspot.com/2008/05/payments-for-patient-centered-medical.html">here</a>, <a href="http://hcrenewal.blogspot.com/2008/07/can-we-fix-medicare-while-pretending.html">here</a>, and <a href="http://hcrenewal.blogspot.com/2008/12/no-such-ruc-new-england-journal-takes.html">here</a>) and important articles by Bodenheimer et al,(1) and Goodson.(2) By the way, why the US Center for Medicare and Medicaid Services (CMS) relies de facto exclusively on the RUC to control the RBRVS system, and why the AMA made the RUC into a secret organization apparently beholden only to the organization's proceduralist members are unanswered questions.<br /></p></blockquote>Our most recent posts about the RUC are <a href="http://hcrenewal.blogspot.com/2009/02/what-ruc-again-one-of-worlds-most.html">here</a>, <a href="http://hcrenewal.blogspot.com/2009/06/letter-from-ruc-and-my-reply.html">here</a>, and <a href="http://hcrenewal.blogspot.com/2009/08/sgim-urges-chuck-ruc.html">here</a>. Other bloggers, notably including Dr Robert Centor on <a href="http://www.medrants.com/">DB's Medical Rants</a>, have criticized the RUC. The Society of General Internal Medicine seems to be the only medical society that has criticized the RUC (see <a href="http://hcrenewal.blogspot.com/2009/08/sgim-urges-chuck-ruc.html">this post</a>). Yet even ostensibly conservative and libertarian pundits who decry price-fixing and rationing by Medicare have ignored this vivid and important example of opaque and unaccountable price-fixing and rationing. And ostensibly liberal proponents of public options and single-payer systems have not explained how they would make their rationing more rational, transparent, and accountable, or how simply insuring more patients under Medicare-like programs would not result in even higher costs, poorer access, and worse quality.<br /><br />The lack of discussion of the RUC remains one of the more striking examples of the <a href="http://hcrenewal.blogspot.com/search/label/anechoic%20effect">anechoic effect</a>. Failing to address why our costs are so high, are access is so poor, and our quality is so challenged will make it likely that any supposed reform effort will only make these problems worse.<br /><br /><strong><span style="font-size:85%;">References</span></strong><br /><span style="font-size:85%;"></span><br /><span style="font-size:85%;">1. Bodenheimer T, Berenson RA, Rudolf P. The primary care-specialty income gap: why it matters. Ann Intern Med 2007; 146: 301-306. Link </span><a href="http://www.annals.org/cgi/content/full/146/4/301"><span style="font-size:85%;">here</span></a><span style="font-size:85%;">.</span><br /><span style="font-size:85%;">2. Goodson JD. Unintended consequences of Resource-Based Relative Value Scale reimbursement. JAMA 2007; 298(19):2308-2310. Link </span><a href="http://jama.ama-assn.org/cgi/content/short/298/19/2308"><span style="font-size:85%;">here</span></a><span style="font-size:85%;">.<br /></span>

The Role of the RUC in Medicare's Price-Fixing and Rationing Remains Anechoic

An important part of the noisy and contentious debate about health care reform in the US centers on the role of the government as a provider of health insurance. Some on the left want a government "si…

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A Window on the Unworkable Settings in Which Physicians Practice

The Annals of Internal Medicine just published an important problem that helps explain why our health care crisis is so intractable. (Linzer M, Manwell LB, Williams ES, Bobula JA, Brown RL, Varkey AB et al. Working conditions in primary care: physician reactions and care quality. Ann Intern Med 2009; 151: 28-36. Link <a href="http://www.annals.org/cgi/content/full/151/1/28">here</a>.)<br /><br />The article arose from the MEMO (Minimizing Error, Maximizing Outcome) study. The study included an initial cross-sectional survey and then longitudinal follow-up of 422 physicians, roughly equal numbers of family practitioners and general internists, in 119 different ambulatory settings in New York City, NY, Chicago, IL, Milwaukee, WI, Madison WI, and smaller towns in WI. The surveys asked physicians about their work-flow and time pressure, the pace of their practice (from calm to chaotic), their ability to control their own work activities, and five aspects of organizational culture (emphasis on quality, emphasis on information and communication, trust, cohesiveness, and alignment of values between physicians and leaders.)<br /><br />The results showed how bad the practice environment in primary care/ generalist practice has become. Some important points were:<br /><br />- More than half of the physicians (53.1%) said they needed more time to do physical examinations, and nearly half (47.6%) for follow-up visits.<br />- <em><strong>Almost half (48.1%) described the pace of their offices as chaotic</strong></em>.<br />- Substantial majorities of physicians thought their workplaces' organizational cultures were deficient, if not hostile.<br />- Only 23.7% thought there was a high emphasis on quality.<br />- Only 28.2% thought there was a high emphasis on communication and information.<br />- <em><strong>Only 30.6% thought there was a great amount of trust</strong></em>.<br />- Only 33.9% thought there was high work place cohesiveness<br />- <em><strong>Only 14.2% thought there was great alignment between the values of leadership and physicians</strong></em>.<br /><br />So, to summarize, many physicians thought they did not have enough time to take care of each individual patient. Most thought their workplaces were nowhere near calm, and nearly half thought they were chaotic. Few thought that their workplaces emphasized quality or communication and information, or inspired trust or cohesiveness. Very few thought that their leaders' values were aligned with their professional values.<br /><br />This blog has focused on problems with the leadership and governance of health care organizations. We have discussed leadership that is:<br />–Autocratic, or “imperial”<br />–Insulated<br />–Uninformed about health care context, indifferent to health care values<br />–Incompetent<br />–Self-interested<br />–Conflicted<br />–Corrupt<br />We have shown that the governance of health care organizations may be:<br />- Unrepresentative<br />- Unaccountable<br />- Opaque<br />- Not Subject to Ethical Standards<br />and that such governance facilitates and enables bad leadership.<br /><br />I submit that the study by Linzer et al suggests how bad leadership can make the settings in which physicians practice unworkable. It may be that some of the time pressure that physicians face is due to the perverse incentives built into their pay schedules (e.g., see <a href="http://hcrenewal.blogspot.com/2009/06/ruckus-continues-former-medicare.html">this post</a>), and bureaucratic demands of insurers and government agencies. A fast paced and demanding environment is one thing, however, and a chaotic envirnoment is another. What else would explain chaotic work environments other than bad organizational leadership? Futhermore, how could well lead organizations ignore quality, and fail to inspire trust and cohesiveness? How could good leaders inspire four-fifths of the physicians to say the leaders of their organizations did not value what they value?<br /><br />This article strongly suggests that we cannot fix the health care crisis simply by changing financing mechanisms or money flows. We can only improve health care by improving the leadership and governance of health care organizations, and by rethinking the size and scope of health care organizations. The most crucial part of health care is what goes on between individual health care professionals and individual patients. Yet our system is composed of endlessly enlarging bureaucracies run by self-interested, often clueless, and sometimes dishonest, if not criminal leaders. This must change, unless we want this crisis to get much, much worse.

A Window on the Unworkable Settings in Which Physicians Practice

The Annals of Internal Medicine just published an important problem that helps explain why our health care crisis is so intractable. (Linzer M, Manwell LB, Williams ES, Bobula JA, Brown RL, Varkey AB …

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The RUCkus Continues: Former Medicare Administrator Calls the "RUC Process" "Incredibly Flawed," and the AMA Chair Says He's "Inaccurate"

We have posted frequently about the role of the RBRVS Update Committee (RUC) in fixing the rates at which Medicare pays physicians. These payment rates have been much more generous for procedures than for "cognitive" services, (that is, services including interviewing and examining patients, making diagnoses, forecasting prognoses, recommending tests or treatments, and counseling patients.) Several authors have suggested that how the RUC fixes payment rates is a major cause of the decline of primary care. (See our previous posts on this <a href="http://hcrenewal.blogspot.com/2007/03/on-disparities-between-reimbursement-of.html">here</a>, <a href="http://hcrenewal.blogspot.com/2007/12/is-sustainable-growth-rate-main-problem.html">here</a>, <a href="http://hcrenewal.blogspot.com/2008/05/payments-for-patient-centered-medical.html">here</a>, <a href="http://hcrenewal.blogspot.com/2008/07/can-we-fix-medicare-while-pretending.html">here</a>, <a href="http://hcrenewal.blogspot.com/2008/12/no-such-ruc-new-england-journal-takes.html">here</a>, <a href="http://hcrenewal.blogspot.com/2009/02/what-ruc-again-one-of-worlds-most.html">here</a>, and <a href="http://hcrenewal.blogspot.com/2009/06/letter-from-ruc-and-my-reply.html">here</a> and important articles by Bodenheimer et al,[1] and Goodson.[2])<br /><br /><strong>An Interview with a former Medicare administrator</strong><br /><br />Health Affairs just published an interview(3) with Kerry Weems, a recent administrator of the US Center for Medicare and Medicaid Services (CMS) under the Bush administration, who had some remarkable criticism for the RUC.<br /><br /><blockquote><br />Iglehart: The last question I wanted to ask you relates to the Specialty Society Relative Value Scale Update Committee [RUC] of the American Medical Association. The AMA formed the RUC to act as an expert panel in developing relative value recommendations to CMS. The twenty-nine-member committee essentially determines, through the relative values it establishes for the codes that form the basis of Medicare payments, how much doctors will earn from providing services to beneficiaries. <em>In recent years the RUC has come under criticism based on the view that its specialty- dominated composition undervalues primary care services and, in some instances, overvalues specialty services. I have two questions, Kerry, regarding the RUC. You have been in government for twenty-six years; have you ever heard of an administration that has seriously questioned the RUC process, and whether CMS ought to somehow internalize it or delegate it to another body?</em><br /><br />Weems: <em>I think there is a general consensus that the <strong>RUC has contributed to the poor state of primary care in the United States</strong>. In many ways the supposition behind the <strong>RUC process</strong>, behind the whole relative value scale, is incredibly flawed.</em> It's an input measurement system, so it asks, What's the cost of my inputs, and that's how I'm going to price my outputs. It has no relationship to perhaps the market value of what you might buy. <em>So because it's highly procedure based, it's prejudiced against just standard primary care evaluation and management [E&M] visits,</em> because in an E&M visit it's hard to document what happens in the same way that it is when you remove a mole, or perform some other procedure.<br /><br /><em>So the process itself is flawed. <strong>I don't think that we can make a change without a statutory change </strong>giving us the ability to do that. But it's something that is drastically needed. You know, it's funny that we talk about better coordination of care and creating the medical home. Well, the place where this can occur is in <strong>an E&M visit, which has been highly undervalued by the RUC</strong>.</em><br /><br />Iglehart: <em>You say that the RUC process is seriously flawed and needs to be overhauled. Was there ever any discussion during the eight years of the George W. Bush administration about doing that?</em><br /><br />Weems: <em>There were a number of discussions, <strong>but it's a hard nut to crack</strong>. Those discussions never ripened to the point where we could say we've got something better.<br /></em><br />Iglehart: But you'd anticipate under the Obama administration that those discussions will continue?<br /><br />Weems: Sure. And, you know, you can even see the early attempts at trying to crack that. Representative [Pete] Stark [D-CA] introduced last year the so-called CHAMP [Children's Health and Medicare Protection Act] bill, in which he proposed to develop a new payment approach that would have provided more money to primary care physicians. He split it up into several different categories. This probably wasn't the right approach, but again, he was trying to work through the problem, trying to provide more money for primary care. His heart was in the right place.<br /></blockquote><br />There are a number of important points here.<br /><br />First, a former CMS administrator charged that the RUC has a substantial role in the decline of primary care in the US. Such charges have been made by well-reputed academics who have analyzed the role of the RUC from the outside. But as we have said before, aspects of what the RUC does are obscure, especially because the proceedings of RUC meetings are not made public. But now someone more directly involved has made the same charges.<br /><br />Second, a former CMS administrator has called the "RUC process ... incredibly flawed." Even the second Bush administration felt these flaws were sufficient to have "a number of discussions," but found "it's a hard nut to crack." Hence he said that although there is something fundamentally wrong with the "RUC process," the government could not easily fix it.<br /><br />Yet RUC leadership has repeatedly said that the RUC is merely a private advisory committee which gives recommendations to CMS using its rights to free speech and to petition the government. (Note also that above, Inglehart first said that the RUC was formed as "an expert panel" to make "recommendations." But then he said the committee "determines ... how much doctors will earn.") If the RUC is simply an advisory committee, and CMS did not like the advice the RUC was giving, why couldn't CMS leaders simply ignore the RUC?<br /><br />Weems' remarks do not make sense if the RUC is merely an outside private group providing advice. But they do make sense if the RUC is acting like a government agency.<br /><br />So this interview once again raises the question: why does CMS rely exclusively on the RUC to update the RBRVS system, apparently making the RUC de facto a government agency, yet without any accountability to CMS, or the government at large?<br /><br /><strong>A response by the Chair of the Board of the AMA<br /></strong><br />Within days of this interview, Dr Rebecca Patchin, the Chair of the Board of Trustees of the American Medical Association (AMA), wrote a response to the Weems interview. (Amazingly, the response appeared as a <a href="http://healthaffairs.org/blog/2009/06/24/the-rucs-record-defending-primary-care/#more-1469">blog post </a>on the Health Affairs Blog.) <br /><br />First, she implied that a former CMS administrator did not know what he was talking about when it came to the RUC.<br /><br /><blockquote>In the interview, <em><strong>inaccurate statements were made</strong> about the role of the AMA/Specialty Society RVS Update Committee (RUC),</em> which advises CMS regarding the relative levels of reimbursement for different medical procedures performed by physicians.<br /></blockquote><br /><br />Now I feel like I am in good company. The leaders of the RUC have charged that I made inaccurate statements about the RUC as well (see post <a href="http://hcrenewal.blogspot.com/2009/06/letter-from-ruc-and-my-reply.html">here</a>).<br /><br />However, Dr Patchin failed to identify any particular statements by Kerry Weems or his interviewer as inaccurate, much less provide any evidence to that effect. Note that while the RUC leaders also charged me with making inaccurate statements, they did not specify any particular statements as inaccurate, much less produce evidence in support of their contentions.<br /><br />Next, Dr Patchin wrote:<br /><br /><blockquote><em>Every time the RUC has been asked to review payments for E&M</em> (evaluation and management) codes, the RUC has sent CMS recommendations that would lead to higher payments.<br /></blockquote><br />This may be so, but it ignores an important issue. While the RUC may have made some recommendations to increase payments for cognitive services, it has made many more recommendations to increase payments for procedural services. Furthermore, while payments for individual procedures went up, and the volume of procedures also went up, the global budget for physicians' services, called the Sustainable Growth Rate (SGR), resulted in across the board cuts. Since raises for procedures were larger and more frequent than raises for cognitive services, the net effect was that payments for procedures increased relative to cognitive services.<br /><br />Even more important, it begs that question: what has the RUC done at times when no one asked it "to review payments for E&M ... codes?" After all, the RUC leadership has argued again and again that it is only a private advisory committee (and see below for another such argument). As such, it should be able to choose how often it deals with payments for cognitive services. It should not have to wait to be asked to review them. So why wasn't the RUC reviewing these payments more frequently?<br /><br />Then, Dr Patchin reiterated:<br /><br /><blockquote>To clarify: <strong><em>The RUC makes recommendations</em></strong> to CMS, and then CMS makes its payment decisions. </blockquote><br />and again,<br /><br /><blockquote><br />Bottom line: <em><strong>the RUC makes recommendations</strong></em>, CMS makes payment decisions.<br /></blockquote><br /><br />This, once more, begs the questions. Why didn't the RUC make more recommendations to improve payments for cognitive services? Why doesn't CMS get recommendations about payments to physicians from sources other than the RUC? Why doesn't CMS make the process for setting physicians' payments, and updating and revising the RBRVS system more broad-based and transparent? Why did the administrator of CMS feel unable to change or ignore the "RUC process?"<br /><br />I don't have the capacity to find out the answers to these questions. Answering them might take some investigative reporting, or even a Congressional investigation. Given that physicians' payments are key incentives driving the health care system, and that payments favoring procedures are likely to be a major cause for rising volume and costs of procedures, which, in turn, is likely to be a major reason our health care system is so expensive, why do we know so little about how these payment rates are set?<br /><br /><span style="font-size:85%;">References </span><br /><span style="font-size:85%;"></span><br /><span style="font-size:85%;">1. Bodenheimer T, Berenson RA, Rudolf P. The primary care-specialty income gap: why it matters. Ann Intern Med 2007; 146: 301-306. Link </span><a href="http://www.annals.org/cgi/content/full/146/4/301"><span style="font-size:85%;">here</span></a><span style="font-size:85%;">.</span><br /><span style="font-size:85%;">2. Goodson JD. Unintended consequences of Resource-Based Relative Value Scale reimbursement. JAMA 2007; 298(19):2308-2310. Link </span><a href="http://jama.ama-assn.org/cgi/content/short/298/19/2308"><span style="font-size:85%;">here</span></a><span style="font-size:85%;">.<br />3. Iglehart JK. Doing more with less: a conversation with Kerry Weems. Health Aff 2009; </span><a href="http://content.healthaffairs.org/cgi/content/full/hlthaff.28.4.w688/DC1"><span style="font-size:85%;">http://content.healthaffairs.org/cgi/content/full/hlthaff.28.4.w688/DC1</span></a><span style="font-size:85%;"> </span>

The RUCkus Continues: Former Medicare Administrator Calls the "RUC Process" "Incredibly Flawed," and the AMA Chair Says He's "Inaccurate"

We have posted frequently about the role of the RBRVS Update Committee (RUC) in fixing the rates at which Medicare pays physicians. These payment rates have been much more generous for procedures than…

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A Letter from the RUC, and My Reply

The vast amounts spent in the US on health care have not translated into access for many patients, consistently excellent quality of care, and signiticantly improved outcomes. While we spend all this money, the primary care and generalist practitioners on the front lines are increasingly embattled and disgruntled, and their numbers are rapidly thinning. One problem may be the pattern of fees paid to physicians. Fees paid to physicians not only influence costs directly, but provide incentives for physician decision making about what tests and treatments patients receive. We have posted several times, most recently in February, 2009, <a href="http://hcrenewal.blogspot.com/2009/02/what-ruc-again-one-of-worlds-most.html">here</a>, about how the US Medicare system sets fees paid to physicians.<br /><br />Since health care reform is now a hot topic in the US, there has been increasing discussion of the plight of primary care and generalist practitioners, but little consideration of how it arose. What we wrote in February was (with updated links):<br /><br /><br /><blockquote><br />As we have discussed, the US Medicare system determines what it pays physicians using the <a href="http://www.ama-assn.org/ama/pub/physician-resources/solutions-managing-your-practice/coding-billing-insurance/medicare/the-resource-based-relative-value-scale/overview-of-rbrvs.shtml">Resource Based Relative Value System (RBRVS)</a>. This system determines the pay for every kind of medical encounter according to a complex formula that is supposed to account for physicians' time and effort, physicians' practice expense, and the cost of malpractice insurance. The components of physicians' effort assessed are, in turn, technical skill and physical effort; the required mental effort and judgment; and stress due to the potential risk to the patient.<br /><br />To keep the system, which was started in 1990, current, requires addition of new kinds of encounters, which means encounters involving new kinds of procedures, and updating of the estimates of various components, including physicians' time and effort. To do so, the Center for Medicare and Medicaid Services (CMS) relies almost exclusively on the advice of the RBRVS Update Committee (RUC). The <a href="http://www.ama-assn.org/ama/pub/physician-resources/solutions-managing-your-practice/coding-billing-insurance/medicare/the-resource-based-relative-value-scale/the-rvs-update-committee.shtml">RUC</a> is a private committee of the AMA, touted as an "expert panel" that takes advantage of the organization's First Amendment rights to petition the government. Membership on the RUC is allotted to represent specialty societies, so that the vast majority of the members represent specialties that do procedures and focus on expensive, high-technology tests and treatments. However, the identities of RUC members are secret, as are the proceedings of the group.<br /><br />This opaque and unaccountable process has resulted in increases outstripping inflation in fees paid for procedures, while fees paid for "cognitive" medicine, i.e., for primary care, and for services that involve diagnosis, management of acute and chronic disease, counseling, coordination of care, etc, but not procedures, have lagged inflation. The effects of the RUC have been amplified by the unexplained tendency of commercial managed care and health insurance to track the RBRVS system when making their own payments to physicians.<br /><br />For further details about the RUC, see these posts on Health Care Renewal (<a href="http://hcrenewal.blogspot.com/2007/03/on-disparities-between-reimbursement-of.html">here</a>, <a href="http://hcrenewal.blogspot.com/2007/12/is-sustainable-growth-rate-main-problem.html">here</a>, <a href="http://hcrenewal.blogspot.com/2008/05/payments-for-patient-centered-medical.html">here</a>, <a href="http://hcrenewal.blogspot.com/2008/07/can-we-fix-medicare-while-pretending.html">here</a>, and <a href="http://hcrenewal.blogspot.com/2008/12/no-such-ruc-new-england-journal-takes.html">here</a>) and important articles by Bodenheimer et al,(1) and Goodson.(2) By the way, why the US Center for Medicare and Medicaid Services (CMS) relies de facto exclusively on the RUC to control the RBRVS system, and why the AMA made the RUC into a secret organization apparently beholden only to the organization's proceduralist members are unanswered questions. </blockquote><br /><br />The next month, Dr William L Rich III, and Dr Barbary Levy, the Chair and Chair-Elect of the RUC, wrote me a letter to "point out several blatant inaccuracies within your blog entry that severely misrepresent the nature and work of the AMA / Specialty Society RVS Update Committee (RUC)." They then asked me to "retract or correct the inaccurate statements within the aforementioned blog immediately." However, the letter did not specify the supposedly inaccurate statements within the blog post. So, my email response noted that "the letter contains no detail about the alleged 'inaccurate statements.' If you define them, we will certainly consider your views." I never got a reply to this message, therefore thinking the matter to be closed, and I saw at that time no reason to make the exchange public.<br /><br />Apparently, the matter was not closed. A few days ago, two anonymous comments were appended to the post. They stated that my letter had appeared on the AMA web-site, <a href="http://www.ama-assn.org/ama1/pub/upload/mm/380/posesresponse.pdf">here</a>. So it is now public. The comments did not say, and I have so far not been able to find out when the letter was posted, and what its context is within the AMA web-site, including any indication that I had already replied to it in private.<br /><br />Despite these irregularities, however, given that the AMA apparently has chosen to make the letter public, I believe I ought to respond publicly.<br /><br /><strong>"Blatant Inaccuracies?"</strong><br /><br />Dr Rich and Dr Levy wrote:<br /><br /><br /><blockquote><br />We would like to take this opportunity to point out several blatant inaccuracies within your blog entry that severely misrepresent the nature and work of the AMA / Specialty Society RBRVS Update Committee (RUC). We request you retract or correct the inaccurate statements within the aforementioned blog immediately.<br /></blockquote><br /><br />First, as I noted above, the letter never specified which of my statements the letter writers considered "blatant inaccuracies." If there are any specific statements of fact in the post above (or any other post I write) that can be shown to be inaccurate, I will correct or retract them. However, I do not believe the letter by Dr Rich and Dr Levy demonstrated any particular statements of mine to be blatantly inaccurate.<br /><br /><strong>The Obscurity of the RUC Membership</strong><br /><br />The letter stated:<br /><br /><br /><blockquote><br />The RUC does not operate in the shadows.<br /></blockquote><br /><br />One of my major criticisms of the RUC was that it is opaque. Before I wrote my first post on the RUC, I tried to determine its membership by searching the AMA web-site, easily available AMA publications, and the web. I could find lists of past members, but no current list. In addition, I asked RUC staff by email whether they could provide me the list, or an easy way to access it. They would or could not do so, and the highest ranking staffer I contacted wrote, "we do not give out the RUC members' contact information. We attempt to shield the RUC from lobbying by industry or others." Only after these inquiries did I dub the RUC membership "secret."<br /><br />Dr Rich and Dr Levy suggested that it is not quite secret. It stated that "a list of the individual members of the RUC is published in the AMA publication, Medicare RBRVS 2009: The Physicians Guide." This publication is available from the AMA <a href="https://catalog.ama-assn.org/Catalog/product/product_detail.jsp?productId=prod1170041">here</a> for a mere $71.95. However, the book is not on the web, or in my local or university library, and I have no other way to easily access it.<br /><br />Additionally, although the letter stated, "any individual may solicit AMA staff directly or a specialty society to learn the names of the members of the RUC," the letter was not accompanied by any communication from AMA staff containing this information.<br /><br />Thus, to date, I still do not know who the members of the RUC are. If the letter authors had wanted to show that the membership of the RUC was not meant to be obscure, they could easily have sent me the list with their letter, appended a copy of the pages of the book which contained the list, or asked their staff to provide this information. They chose not to do so. So, while the RUC membership may not be exactly secret, it remains obscure, only barely public, and relatively inaccessible.<br /><br /><strong>The Secrecy of RUC Proceedings</strong><br /><br />Furthermore, to support its contention that "the RUC does not operate in the shadows," the letter stated that<br /><br /><br /><blockquote><br />any individual may attend a RUC meeting upon: (1) the invitation of and notification by a relevant specialty society; (2) an express invitation by the chair of the RUC; or (3) the approval of a written request to attend; and a review of conflicts and potential conflicts of interest.<br /></blockquote><br /><br />This does not mean that RUC meetings are open, or that their proceedings are public. Instead, as Goodson(2) noted, RUC "meetings are closed to outside observers except by invitation of the chair." Furthermore, he stated, "<em>proceedings are proprietary and therefore not publicly available for review</em>."<br /><br />The letter also personally invited me to attend "the next meeting of the RUC, which will take place April 23-26, 2009 in Chicago." In retrospect, this invitation did not appear serious, since it was never repeated or expanded after my email reply to the March letter.<br /><br />Nor did the invitation include any assurance that I could make anything about this meeting public. I had learned from a previous RUC attendee who will remain anonymous that attendees are obligated to sign non-disclosure agreements. Signing such an agreement might jeopardize my further ability to write anything of substance about the RUC. Furthermore, making all meeting attendees sign non-disclosure agreements effectively makes the meeting secret.<br /><br /><strong>The RUC and Primary Care</strong><br /><br />Dr Rich and Dr Levy asserted that:<br /><br /><br /><blockquote><br />Your publication irrationally and unreasonably paints the RUC as the perpetrator of all physician payment policies that have negatively affected primary care.<br /></blockquote><br /><br />Furthermore, they argued that the RUC has been good for primary care and cognitive practice:<br /><br /><br /><blockquote><br />The RUC has made several recommendations that positively benefit cognitive and non-procedural physician specialties.<br /></blockquote><br /><br />My opinions about the RUC's influence on payments to physicians, and the decline of primary care and generalist and cognitive practice are hardly original. My previous posts were clearly based on evidence and discussion from references 1-4. Let me summarize these arguments, using direct quotes from these references, which perusal of the original articles would reveal are not taken out of context.<br /><br /><em>Primary and generalist practice is threatened by the current payment system.</em><br /><br />From Bodenheimer et al(1):<br /><br /><br /><blockquote><br />Incomes of primary care physicians are well below those of many specialists, and the primary care–specialty income gap is widening.<br /><br />... the lower income of primary care physicians is a major factor leading U.S. medical students to reject primary care careers.<br /><br />Primary care practice is not viable without a substantial increase in the resources available to primary care physicians.<br /></blockquote><br /><br />From Goodson(2):<br /><br /><br /><blockquote><br />Medicine's generalist base is disappearing as a consequence of the reimbursement system crafted to save it—the resource-based relative value scale.<br /><br />Current reimbursement incentives substantially favor procedures and technical interventions and offer financial advantages for expensive care, thereby encouraging specialty services.<br /><br />The continued and sustained incentives for medical graduates to choose higher-paying specialty careers and for those physicians in specialty careers to increase income through highly compensated professional activities have been associated with the dwindling of the generalist workforce. The lack of incentives for medical graduates to choose generalist careers in internal medicine, family medicine, and pediatrics has had a profound effect on the workforce mix and, ultimately, US health care expenditures.<br /></blockquote><br /><br /><br /><em>The RUC has been the major influence on the physician payment system leading to these problems</em>.<br /><br />From Bodenheimer et al(1):<br /><br /><br /><blockquote><br />In summary, the RUC process favors increases in procedural and imaging reimbursement for 3 reasons: specialty society influence in proposing RVU increases, the specialist-heavy RUC membership, and the desire of RUC specialists to avoid increases in evaluation and management RVUs. With their ability to create new codes and influence RVU updates, many procedural specialists can influence fees in a way that observers find to substantially overvalue procedural and imaging services. Moreover, high fees may encourage physicians to increase the volume of profitable services, leading to even higher income gains and greater spending growth.<br /></blockquote><br /><br />From Goodson(2):<br /><br /><br /><blockquote><br />The RUC has powerfully influenced CMS decision making and, as a result, is a powerful force in the US medical economy. Furthermore, by creating and maintaining incentives for more and more specialty care and by failing to accurately and continuously assess the practice expense RVUs, the decisions of CMS have fueled health care inflation. Doing so has affected the competitiveness of US corporations in the global market by contributing to years of double-digit health care inflation that have consistently increased the costs of manufacturing and business in the United States over the last decades.<br /><br />The current mechanism fails to provide sufficient checks and balances and is skewed and dysfunctional.<br /><br />The resource-based relative value scale system originally developed to achieve full value for cognitive services currently threatens the sustainability of the generalist base. As a result, a large portion of the population will lose access to the continuous and personalized care provided by generalist physicians whose repertoire of clinical skills and interventions coupled with access to specialty and diagnostic services are essential for ensuring efficient and effective health care delivery.<br /></blockquote><br /><br />Dr Rich and Dr Levy are entitled to their opinions, but I would argue that there is considerable evidence and opinion suggesting that the current dysfunctional physician payment system is a major cause of the decline of primary care and cognitive practice, and simultaneous rise in health care costs and decline in health care access in the US. Furthermore, there is also considerable evidence and opinion suggesting that the RUC has singular responsbility for the dysfunctionality of the payment system and how it is skewed in favor of procedures as opposed to cognitive services and primary care.<br /><br /><strong>Summarizing: the Opacity of the RUC, and its Negative Effects on Primary Care and Cognitive Services</strong><br /><br />So, I stand by my statement that the RUC process is opaque. Instead of saying "the identities of RUC members are secret, as are the proceedings of the group," I would be willing to now say, "the identities of the RUC members are obscure and difficult to ascertain, and the proceedings of the group are secret." That is not much of an improvement.<br /><br />If the RUC leadership wants to make its membership transparent, all it needs to do is post it on the web. If it wishes to make its proceedings transparent, all it needs to do is publish them as well. If it makes such changes, I would happily and publicly applaud them.<br /><br />If the RUC leadership wants to show that their members are not influenced by individual conflicts of interest, transparency about the committee's membership would inspire more trust than making the information as obscure as possible.<br /><br />Furthermore, there may be more reason to be concerned about the effects of institutional rather than individual conflicts of interest on the RUC. Most RUC members appear to represent specialty societies. Rothman et al claimed that industry funding of professional medical societies is "pervasive."(5) If the RUC leadership wants to show that their committee as a whole is not affected by institutional conflicts of interest of its specialty societies, it ought at least to disclose the relationships of those societies and their leaders with companies that stand to profit from increasing utilization of the specific services whose use is influenced by the incentives which the RUC largely determines.<br /><br />Finally, if there is a "wedge between cognitive and procedural specialties" it was driven a long time ago, particularly by a payment system that progressively favored the latter over the former, and by a bureaucratic burden that fell disproportionately on the former. But blaming the messenger is a time-honored, if not necessarily honorable tactic.<br /><br /><span style="font-size:85%;"><strong>References</strong><br /><br />1. Bodenheimer T, Berenson RA, Rudolf P. The primary care-specialty income gap: why it matters. Ann Intern Med 2007; 146: 301-306. Link </span><a href="http://www.annals.org/cgi/content/full/146/4/301"><span style="font-size:85%;">here</span></a><span style="font-size:85%;">.<br />2. Goodson JD. Unintended consequences of Resource-Based Relative Value Scale reimbursement. JAMA 2007; 298(19):2308-2310. Link </span><a href="http://jama.ama-assn.org/cgi/content/short/298/19/2308"><span style="font-size:85%;">here</span></a><span style="font-size:85%;">.<br />3. Ginsburg PB, Berenson RA. Revising Medicare's physician fee schedule - much activity, little change. N Engl J Med 2007; 356: 1201-1203.<br />4. Newhouse JP. Medicare spending on physicians - no easy fix in sight. N Engl J Med 2007; 356: 1883-1884.<br />5. Rothman DJ, McDonald WJ, Berkowitz CD et al. Professional medical associations and their relationships with industry: a proposal for controlling conflict of interest. JAMA 2009; 301: 1367-1372. Link </span><a href="http://jama.ama-assn.org/cgi/content/full/301/13/1367"><span style="font-size:85%;">here</span></a><span style="font-size:85%;">. </span>

A Letter from the RUC, and My Reply

The vast amounts spent in the US on health care have not translated into access for many patients, consistently excellent quality of care, and signiticantly improved outcomes. While we spend all this …

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