The Government Accountability Office (GAO) has issued a report pointing out potential shortcomings in the data and process used by CMS to establish the relative values (and consequently the reimbursement levels) for Medicare physician services. In particular, the GAO expresses concern that the American Medical Association/Specialty Society Relative Value Scale Update Committee (RUC) process for reviewing Medicare physicians’ services’ work relative values relies on the input of physicians who may have potential conflicts of interest with respect to the outcomes of CMS’s process. Moreover, the GAO believes that there are weaknesses in some of the RUC’s survey data, including low response rates, low total number of responses, and large ranges in responses, all of which may undermine the accuracy of the RUC’s recommendations. According to the GAO, because CMS relies heavily on RUC recommendations when establishing relative value units (RVUs), data-related weaknesses associated with the RUC’s recommendations could result in inaccurate Medicare payment rates. The GAO also faults CMS for not employing a more transparent process with regard to potentially misvalued services, particularly since it does not document the methods it uses to review specific RUC recommendations. CMS also does not maintain a database to track when a service was last valued, nor does the agency have a documented standardized process for prioritizing its reviews, according to the GAO.

In the report, “Medicare Physician Payment Rates: Better Data and Greater Transparency Could Improve Accuracy,” the GAO recommends that CMS take three steps to improve its process for establishing Medicare RVUs:

  • Better document the process for establishing RVUs, including the methods used to review RUC recommendations and the rationale for final RVU decisions.
  • Develop a process for informing the public of potentially misvalued services identified by the RUC.
  • Incorporate data and expertise from physicians and other relevant stakeholders into the process, as well as develop a plan to implement recent legislative changes to the RVU process.