NEJM on Medicare reimbursement: "No easy fix in sight"

The problems are identified, but the authors are not hopeful of a solution anytime soon. One reason is that maybe there has been too much complaining about the undervalued E&M codes:

Although the resource-based relative-value scale may have better aligned fees with costs than the old method based on the Blue Shield system, the cost of new procedures often decreases over time. In principle, any such decreases are to be accounted for by an annual review of relative fees and a more intensive 5-year review, but in practice this mechanism has been flawed. Initial errors should have been equally likely to have been high or low, so correcting them should have led to roughly equal numbers of fee increases and decreases. Since new procedures generally become less costly to perform as they become part of routine practice, on balance the reviews should have decreased more fees than they increased. Maxwell and colleagues, however, show that exactly the opposite happened. Relative fees are almost never reduced in the review process and are frequently increased; they rose fully 82% of the time in the first 5-year review. This increase probably stems from the “squeaky wheel syndrome” “” services that are relatively undervalued are more likely to generate complaints and hence enter the review process than services that are overvalued. Although the overall spending limit prevents such asymmetric changes from generating increases in Medicare spending on physicians, the net result may well be a distorted relative-value scale.

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