Physicians Help Set Prices On Medicare Services – Is This Expert Input Or A Conflict Of Interest?

August 19, 2013

There are two sides to every story.

On the one hand, there is the exposé by the Washington Post last month that accused a closed- door committee of the American Medical Association (AMA) of inflating its estimates of times it should take physicians to perform various medical procedures. This is important because physician payments for procedures under Medicare, by law, are based on “time and intensity” — the more time a procedure takes, the more money physicians get from Medicare for performing it. According to the Post article, the Centers for Medicare and Medicaid Services (CMS) relies almost exclusively on the recommendations of this volunteer committee when it sets those payments.

On the other, in a recent opinion piece in USA Today, Dr. Ardis Dee Hoven, the new president of the AMA, defended the committee by arguing for the importance of physician input. With the rapid advances in medical science and technology in patient care, there is a pressing need to evaluate new services and, according to Dr. Hoven, there is “simply no substitute for physicians’ clinical expertise when gauging how much work and resources go into one medical service compared with another.”

In defending its assertions, the Post wrote about a physician in Florida who in 2012 performed 12 colonoscopies and four other procedures in a typical day — noting that if the procedures took the amount of time that the AMA estimated they should, the physician would be working 26 hour days. In fact, said the Post based on available data, “Florida records show 78 doctors — gastroenterologists, ophthalmologists, orthopedic surgeons and others — who performed at least 24 hours worth of procedures on an average workday.”

The Post also noted that the AMA committee is not open to the public, and therefore it is difficult to discern the committee’s methods or its true motives.

In her USA Today piece, Dr. Hoven noted that CMS is open to public input from anyone. She explained the committee’s lack of transparency as an effort to avoid political pressure that could influence its decisions. She also highlighted the cost-saving aspect of the committee’s recommendations, writing that the committee recently freed up “more than $2.5 billion to be redistributed to other services…” when it reviewed “1,300 such services and recommended reductions to more than 500 that were previously overvalued.”

Bottom line, the AMA evaluating Medicare services is either an example of the fox guarding the chicken coop or of a government agency responsibly taking the advice of the people who best know the complexities of medical services and procedures.

Maybe it’s a little of both. What do you think?

One Response to “Physicians Help Set Prices On Medicare Services – Is This Expert Input Or A Conflict Of Interest?”

  1. Very useful information for today and helpful historical information as well.

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