09.13.2017 / Press Release

CMS Proposes to Make it Easier for Physicians to Set their Own Payment Rates

Washington, D.C. – In a startling move, the Centers for Medicare & Medicaid Services (CMS) has proposed to essentially outsource setting of physician rates in traditional Medicare to a physician-run committee called the “RVS (Relative Value Systems) Update Committee” or RUC.  CMS proposes to “shift [its] approach” to physician payment rates by “rely[ing] more heavily on RUC-recommended values,” and then proceeds to propose adoption of 262 out of 263 rates proposed by the RUC.

The bipartisan Congressionally-appointed Medicare Payment Advisory Commission (MedPAC) uses strong and direct language in its comment on this proposed rule: “We believe that CMS is moving in the wrong direction by proposing to accept all of the RUC’s recommendations for work RVUs for 2018 without modification. This approach is inconsistent with the Commission’s longstanding view that CMS relies too heavily on input from the RUC, which is made up of practitioners who have a financial stake in the payment rates for fee schedule services. The executive branch and the Secretary have the responsibility and authority to manage the Medicare program on behalf of taxpayers and beneficiaries.”  Families USA strongly agrees with this concern, as emphasized in our own comment on the proposed rule.

Following is the statement of Frederick Isasi, Executive Director of Families USA:

“CMS’s proposal to defer to the provider RVS Update Committee in setting the values that largely determine physician rates in Medicare would give the providers who are paid by Medicare the ability to essentially set their own rates. This step would weaken the Medicare program, undermine efforts to improve health care payment, and increase out-of-pocket costs for our seniors and people with disabilities.

“Allowing the specialist-dominated RUC free rein over the Medicare physician payment methodology will surely worsen Medicare’s longstanding underpayment of primary care and behavioral health. Moreover, many private insurers and Medicaid programs base their payment rates as a percentage of Medicare –so, if finalized, this proposal likely would ripple throughout most of the health care system and reverse efforts to elevate and improve reimbursement for primary care and behavioral health. We call on Secretary Price to move beyond a focus on highly-compensated specialist physicians and to be a leader for Medicare beneficiaries and for all Americans.

“CMS has both the authority and the responsibility to set physician reimbursement rates and to continue to move Medicare toward value-based payment that emphasizes community-based and preventive care.”