How a secretive panel jacks up doctor pay

How the AMA is inflating the value of what doctors do – and distorting their pay:

This seemingly miraculous proficiency, which yields good pay for doctors who perform colonoscopies, reveals one of the fundamental flaws in the pricing of U.S. health care, a Washington Post investigation has found.

Unknown to most, a single committee of the AMA, the chief lobbying group for physicians, meets confidentially every year to come up with values for most of the services a doctor performs.

Those values are required under federal law to be based on the time and intensity of the procedures. The values, in turn, determine what Medicare and most private insurers pay doctors.

But the AMA estimates of the time involved in many procedures are exaggerated, sometimes by as much as 100 percent, according to an analysis of doctors’ time, interviews and medical journals.

Indeed, if the time estimates are to be believed, some doctors would have to be averaging more than 24 hours a day to perform all of the procedures that they are reporting. This volume of work does not mean these doctors are doing anything wrong. They are just getting paid at rates set by the government, under the guidance of the AMA.

In fact, in comparison with some doctors, Sheela’s pace is moderate.

Take, for example, those colonoscopies.

In justifying the value it assigns to a colonoscopy, the AMA estimates that the basic procedure takes 75 minutes of a physician’s time, including work performed before, during and after the actual scoping.

But in reality, the total time the physician spends with each patient is about half the AMA’s estimate — roughly 30 minutes, according to medical journals, interviews and doctors’ records.

Indeed, the standard appointment slot is half an hour.

To more broadly examine the validity of the AMA valuations, The Post conducted interviews, reviewed academic research and conducted two numerical analyses: one that tracked how the AMA valuations changed over 10 years and another that counted how many procedures physicians were conducting on a typical day.

It turns out that the nation’s system for estimating the value of a doctor’s services, a critical piece of U.S. health-care economics, is fraught with inaccuracies that appear to be inflating the value of many procedures.

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