Medicare pays three to five times more per hour for two common procedures than it does for evaluation and management services, according to a new study, and that imbalance may help push physicians away from primary care careers.
Dr. Christine A. Sinsky, an internist in Dubuque, Iowa, and Dr. David C. Dugdale, of the division of general internal medicine at the University of Washington, Seattle, decided to delve into the disparities between pay for primary care and procedures, hypothesizing that the gap is helping tilt the health system toward an emphasis on procedural over cognitive care.
Their findings were published online Aug. 12 in JAMA Internal Medicine (doi: 10.1001/jamainternmed.2013.9257).
After reviewing their data, the authors squarely blame the American Medical Association’s Relative Value Scale Update Committee (RUC) and Medicare for creating incentives that reward procedures over complex management of chronic illness.
The study authors compared hourly revenue for a physician performing cognitive services (CPT code 99214) to the hourly revenue generated by a physician performing either screening colonoscopy (G code 0121) or cataract extraction (CPT code 66984). They chose these codes because they are among Medicare’s most billed codes. The 99214 code ranks second, cataract extraction is fourth, and colonoscopy is 36th.
The authors focused on the work-specific relative value unit (wRVU), saying that it most accurately reflected the amount of time physicians put into a visit or procedure.
They found that doctors billing the evaluation and management (E&M) code of 99214 received hourly revenue of $87. Screening colonoscopy, on the other hand, generated hourly revenue of $320, and cataract extraction generated $423 per hour.
These wages did not correspond to time spent on services, or intensity, said Dr. Sinsky and Dr. Dugdale.
The Centers for Medicare and Medicaid Services (CMS) requires physicians to spend 25 minutes face-to-face with the patient to be reimbursed for the 99214 code. There are no such requirements for procedural codes. Using reports in the literature, the authors estimated that a colonoscopy takes 13.5 minutes, and a cataract extraction takes 14 minutes.
However, the AMA’s RUC used vastly different times when it set the wRVU for both cognitive services and procedures, the authors said. According to their research, the RUC estimates that 99214 requires 40 minutes, a colonoscopy 75 minutes, and a cataract extraction 84 minutes. That results in hourly revenue of $77, $100, and $121, respectively – much less of a gap than what Dr. Sinsky and Dr. Dugdale found.
The researchers offered two explanations for the discrepancy between the RUC’s calculations and their own determinations.
First, primary care physicians are vastly underrepresented on the RUC, making up 16% of the voting members despite making up half of the U.S. physician population. The relative imbalance of primary care representation has been a source of ire for family physicians and internists.
Second, "the RUC method uses self-reported times for services in which the purpose of the survey (to establish payment rates) is known to the respondents who stand to benefit by inflated estimates," the study authors noted.
Dr. Sinsky and Dr. Dugdale said that their estimates may be conservative, because physicians who bill for cognitive services generally do a lot of work between appointments that is not reimbursed. Even if they can’t exactly quantify the gap, it is there, they said.
"Our model demonstrates that an ophthalmologist will receive more revenue from Medicare for four cataract extractions, typically requiring 1-2 hours of time, than a PCP [primary care physician] will receive for an entire day of delivering complex care for chronic illness to Medicare patients," they wrote.
Overall, the reimbursement gap is "a major contributor to the decline in the number of physicians choosing primary care careers," the researchers noted. And it likely also helps fuel the ongoing growth in "expensive procedural care," they added.
That "is worthy of further evaluation," concluded Dr. Sinsky and Dr. Dugdale.
Dr. Sinsky and Dr. Dugdale reported no conflicts of interest.
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