The People Who Decide What Medicare Pays Doctors

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. How much should radiologists get for administering an MRI? How much should cardiologists be paid for inserting a heart stent?

While these doctors always discuss the “value” of each procedure in terms of the amount of time, work, and overhead required of them to perform it, the implication of that “value” is not lost on anyone in the room: they are, essentially, haggling over what their own salaries should be. “No one ever says the word ‘price,’ ” a doctor on the committee told me after the April meeting. “But yeah, everyone knows we’re talking about money.”

Haley Sweetland Edwards has a really terrific investigative piece in Washington Monthly looking at the American Medical Association’s committee of doctors who meet three times a year to determine the value of the medical procedures they perform and how much Medicare should be paying them. The committee’s meetings are closed to the public and the press, and even though there is a clear conflict of interest — the doctors are telling the government how much they should be paid — it’s all completely legal:

In a free market society, there’s a name for this kind of thing — for when a roomful of professionals from the same trade meet behind closed doors to agree on how much their services should be worth. It’s called price-fixing. And in any other industry, it’s illegal — grounds for a federal investigation into antitrust abuse, at the least.

But this, dear readers, is not any other industry. This is the health care industry, and here, this kind of “price-fixing” is not only perfectly legal, it’s sanctioned by the U.S. government.

The story and all the details, including how specialists have more clout on the committee than primary care physicians, can be read here.

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