30 April 2009

Physician Compensation -- an End-run

I had an off-the-record conversation with a member of the RUC earlier this year -- not necessarily an Emergency Physician, but a member familiar with the strategies of the alliance of cognitive physicians. I asked him whether there was going to be another rebalancing of the RVU system to favor primary care, as there was in 2006. He indicated that the primary care lobby had essentially given up on the RUC as irredeemably corrupt (OK, maybe that's just my interpretation of what he said) and that they were going to be going directly to CMS to ask for additional payments.

It seems that strategy has borne its first fruit. Senate heavyweights Max Baucus and Chuck Grassley have a bipartisan proposal which would increase payments to PCPs by 5% while reducing payments to other physician specialists, in order to offset this in a budget neutral fashion.

Predictably, the specialty societies will fight this hammer and tongs.

In my opinion, the 5% bonus is probably inadequate -- it should be at least 10%, and I say this as a member of a specialty that will probably not be considered primary care for the purpose of this payment. The RVRBS was created and is periodically rebalanced based on the concept of rewarding physician work, which seems fair on the face of it. It's pretty indisputable, however, that the formula has become skewed so far in favor of procedural medicine that short of a wholesale rethinking of the system it cannot accomplish the policy goals that it is supposed to.

The physician compensation system needs to be reoriented not to reward "work" but to create the incentive for physicians to fill the roles which our health care system needs.

We need primare care docs more than we need ENTs (for example). No disrespect to ENTs; I greatly appreciate their services when they come to the ER and stop a tricky nosebleed or drain a peritonsillar abscess. It's important work. But the number of people who will suffer from a shortage of ENTs (or urologists, or orthopedists, etc etc) pales in comparison to the number of people who are and will suffer from a lack of primary care. If the President is successful in providing health insurance to 47 million more Americans, then the current shortage of PCPs will become much, much worse. In order to encourage physicians to pursue these necessary fields, the incentives need to set such that the earning potential for a subspecialty surgeon does not so greatly exceed that for an office-based physician.

People are rational actors and repond predictably to incentives. Perverse incentives, such as we currently have, result in perverse outcomes, such as the fact that only 2% of medical students currently intend to specialize in primary care. The incentives need changing.

Some have argued that we should just pay the PCPs more, without reducing specialty compensation. To that, I would say first that such a change would likely not achieve the desired goals. Currently, it's possible to make two or three times an internist's salary as a surgeon. Unless you increase the PCP's income by a large factor, that income gap is going to remain large. Bringing one up and the other down, however, will more efficiently neutralize the disparity.

More to the point, in the current system of health care approaching 17% of GDP, it's completely unrealistic to expect that Congress will allow physician reimbursement to go UP. Every stakeholder at the table has made major concessions (or will be asked to). The insurers are accepting community rating. Small businesses will be hit with pay or play. If this is the bitterest pill that doctors are asked to swallow then we will be getting off easy. It is the sheerest fantasy to think that we can lobby for a pay increase.

If the proceduralists fight this, they are going to lose. How do I know this? I don't, but in my recent visit to Capitol Hill, I spoke with no fewer that nine members of congress and/or their health policy directors (all democrats). All of them have the "primary care" mantra down pat. It was encouraging given the state of primary care to see that they understand that it needs to be a priority, even if it was frustrating as an advocate for emergency medicine to try to educate them about the needs of the acute care system.

This proposal by Baucus and Grassley is encouraging even if it is a kludge-y workaround of the failure of the RUC. It would have been better to abolish it and re-invent the RVRBS, because the formulas are still terribly flawed. This is like the annual SGR patch, a temporizing measure that kicks the can down the road a few years -- which is forgivable given the scope of the reforms they are currently contemplating. Ultimately, fundamental physician payment reform is still necessary.


  1. Do you have any data on primary care shortages that adjusts for MLP utilization in the primary care setting.

    For every time I read stuff like this, it seems to me it does not take into account the very real ability to use MLPs in the primary care setting in much higher numbers/ratios vs. higher acuity environments like EDs, inpatient settings, ICUs, etc...

    Do you have data that says otherwise?

    I have looked for this data for a long time and NEVER found anything one way or the other although most studies I have read do seem to admit there appears to be no shortage of MLPs in the primary care setting.

  2. After primary care, the next focus of shortage is general surgery.

  3. First BEFORE ever considering to give a PRIMARY CARE DOCTOR,even a scintillant of a percentage of a CENT...
    Lets Hang the Wash out and TELL THE TRUTH,and rip up the MEDI PADs.......JUST STOP AND THINK,show me a doctor that doctors!

    Think about England The Primary Care Doctors GET PAID BASED ON MERIT..
    IF They get you to stop smoking, Drop weight,cholesterol, keep sugar under control you KNOW
    they get BONUSES!
    hummm why would the UK Government do this
    CAUSE THEY ARE PAYING" Socialized Medicine? Despite the statistics... and OUR FAT BODIES(I am over weight) and WAS NOT ALL MY LIFE...
    why was I put on BP meds at like age 29" I was never told to exercise or do this and that...NO BODY GIVES A POOP,NEXT"
    even when I am in pain cause A IV infiltrates in my arm during a CT SCAN..........I AM RUSHED HURRY YOUR NOT THE ONLY ONE here
    IN US

    I cant go to my Primary and get a PAP SMEAR she cringes, I cant get a stitch" and GET a image compared to the Previous by that same...doc........
    what the hell am I going to a primary for? She skips over my test results and has to ask others to explain it to her?. JUST GIVE ME THE PERMISSION to follow a plan .that is what science based medicine is, MY DOCTOR HAS NO wisdom, she is not even Board certified! I WAS NEEVR TOLD THIS<you should actually pay less for a doctor like this..
    WHAT THE HELL DO THEY DO FOR US? I see No need for a Primary care Physician, and to even say give them
    5% no 10% RAISE.. will this mean there is 42 Seconds More Time offered in a Office visit (I deduce this) BASED on that dag-nab-bit 7 min Clinic Model.(get the Book "7 Min. Clinic
    I know the Incentives they get from Drug companies are not much but perhaps this should be deducted... and the SCREW UPS and THE LAC OF INTEREST


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