1. Thirty-one people meet in private, once every three years, to determine the entire country’s health care prices. The Relative Value Update Committee (the RUC, pronounced “ruck” by health wonks) has members that represent various medical specialties. In 2013, they gathered at a hotel in Chicago, and went about their business of setting price data for one of the country’s largest economic sectors.
“The purpose of each of these triannual RUC meetings is always the same: it’s the committee members’ job to decide what Medicare should pay them and their colleagues for the medical procedures they perform,” Edwards writes. “How much should radiologists get for administering an MRI? How much should cardiologists be paid for inserting a heart stent?”
2. The American Medical Association spends $7 million developing these prices. Medicare has a half-dozen, part-time workers to review the data. The RUC does not have the final say in medical prices; once they have determined the relative value of procedures, the MRIs and heart stents and hundreds of other things, Medicare reviews their findings. But they don’t have much manpower in this area. “The government has about six to eight people reviewing the estimates provided by the AMA, government officials said, but none of them do it full time,” Whoriskey and Keating write.
This helps explain a data point from Edwards’ piece: In the past 22 years of turning prices over to Medicare, the agency “has accepted about 90 percent of the RUC’s recommended values—essentially transferring the committee’s decisions directly into law.”
3. If the RUC’s estimates were right, some doctors would literally work more than 24 hours each day. One way the RUC figures out how much doctors should earn is by estimating how long it takes to do a particular procedure, like the average time of a colonoscopy. Those estimates, Whoriskey and Keating’s analysis suggests, are inflated. If those numbers are right, 78 doctors in Florida must work more than 24 hours a day to perform all the medical procedures they bill. One especially impressive doctor finds time for 50 hours worth of procedures in a given day.
6. Doctors tell the RUC how valuable their work is. In a way, it makes sense to ask doctors how much work it takes to practice medicine; they probably have the best first-hand knowledge of what happens when they perform a heart surgery or a colonoscopy. But surveying doctors on how difficult their work is to set medical prices creates every incentive for doctors to overestimate their value.
