The idea of RVUs disgusts me

Blaming the American Medical Association’s Relative Value Scale Update Committee (RUC) for everything has become the latest fashion. The RUC is causing climate change. The entire health care cost problem comes from RUC decisions. Alex Rodriguez took performance enhancing drugs because of the RUC.

But the RUC did not create the system. They try hard to balance a system that is designed to achieve the wrong outcomes. The RUC has become a very easy and attractive kicking post, but the problem comes from the idea of resource-based relative value units (RBRVS).

As I understand it, RBRVS represents a series of economic formulae that will take into consideration the average time a medical encounter takes (obviously longer for an operation, shorter for most office visits), the complexity of the encounter, and the amount of training needed to adequately perform the encounter and the financial overhead involved. Thus, these complex formulae represent averages.

We know about averages. If we put one foot in boiling water and one in ice, on average we are comfortable. But the problem is that averages are deceiving. The RUC continuously has to revalue the complex inputs to these formulae. But revaluation takes time. If the original procedure took 3 hours, and technique advances allow one to perform the procedure in 1.5 hours, you just doubled you income rate. In fact that has happened often.

Even if the RUC was a full time committee that revalued continuously (obviously an impossibility), the idea of RBRVS leads to financial gaming. This wonderful post explains the dilemma: Physician Payment: Forget Carrots And Sticks, It’s Motivation.

All professionals need to be paid for their work, and money is the mechanism to do that in all but a barter economy. However, payment reform must avoid one key pitfall if it has any chance to succeed. We must not try to replace motivation with an artificial charge. This will be challenging for many in the industry. Hospitals and health systems still use RVUs as the primary form of calculating total compensation, much like private sector companies put salespeople on commission. That must change. Health plans and Medicare continue to overwhelmingly use fee for service, much like farmers get paid by the bushel or the cattle head. And that must change.

The idea of RVUs disgusts me. It turns patient encounters into different valued widgets. It explicitly encourages us to see patients more quickly. It values all the wrong things.

So I do not blame the RUC. They have not done a perfect job, but they are working to patch a flawed concept. Our patient encounters are not widgets. There are too many variables to derive a satisfactory formula.

We need to evolve to a system that allows for internal motivation and rewards physicians fairly but without incentives to do more faster. We cannot blame the RUC for the system.

Robert Centor is an internal medicine physician who blogs at DB’s Medical Rants.

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  • buzzkillerjsmith

    The article linked to is quite good. Too bad admin types and the feds don’t believe that we could possibly have internal generators since they most don’t. They’ll stay on the wrong path for a while yet.

    BTW, disgust is a strong word that I reserve for tapeworms and suchlike. But I will allow that the current situation is suboptimal.

  • buzzkillerjsmith


  • southerndoc1

    “Health plans and Medicare continue to overwhelmingly use fee for service, much like farmers get paid by the bushel or the cattle head. And that must change.”

    Well, I don’t know if I agree.

    Where is the evidence that FFS is the cause of our health care problems? Where is the evidence that some other vaguely “value-based” (whatever that means) system will solve those problems?

    What we do know is that most other industrialized countries, using FFS, provide health care that is much cheaper than ours and generally fairly comparable in quality. We shouldn’t ignore their successes.

  • Michael Wasserman

    Thanks for your excellent comments. And, thanks for directing me to the RWJF article. It’s an excellent resource! I concur completely with your concerns. I’ve spent the last 25 years as a Geriatrician in a variety of systems, some with fee-for-service and some with capitation. I’ve had to come up with methods to maximize “productivity”, while trying to maintain or improve quality. I agree that the RUC isn’t the problem itself, but it is also a means for maintaining a system that doesn’t work.

    One problem is that fee-for-service will not disappear overnight, and appropriate quality measures will not appear overnight. In the field of geriatrics, at the heart of the Medicare program, this is a huge problem. We have a long ways to go before we have solid evidence based quality measures by which to make any judgements. What do we do in the meantime? I’ve often thought that we should just pay physicians for their time. Yes, pay them an hourly fee. While this might encourage some physicians to just spend a lot more time with each patient, that isn’t necessarily a bad thing, especially when it comes to caring for the frail elderly, who by their very nature are quite complex, and don’t simply fit into a 15 minute return visit. Honestly, the only gaming that will occur with hourly pay will be within an individual physician’s own efficiencies. They will still have to put in the time. Again, there can not be a perfect answer, but while we’re waiting to develop an appropriate quality based reimbursement model, why not come up with something that won’t continue to reinforce the gaming mentality that occurs in both fee-for-service and for that matter, many existing captivated models.

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