Have you ever wondered how Medicare sets reimbursement rates for physicians? These rates are crucial because they not only affect Medicare payments, but also are the basis on which private payers establish their own individual payment levels, too.

When the Centers for Medicare and Medicaid Services (CMS) released its proposed 2020 Physician Fee Schedule (PFS) in late July, it included increases in the value of the emergency medicine codes that will have a positive ripple effect on emergency medicine reimbursement for years to come. This proposed increase was the result of months of behind-the-scenes work by ACEP members and staff working on your behalf to advocate for the profession as a whole.

The Process

Every year, CMS identifies specific physician codes the agency believes are valued either too high or too low. CMS sends this list of potentially mis-valued codes to a committee run by the American Medical Association (AMA) called the Relative Value Scale Update Committee (RUC). Through the process described in Figure 1, the RUC makes specific CMS code value recommendations. CMS then decides, through federal rulemaking, whether to accept or reject the RUC recommendations for each code.

What Is the RUC?

The RUC is composed of 31 members who represent the entire medical profession, including 21 appointed by specialty associations. The other 10 members include rotating specialty seats and representatives from other stakeholder organizations. Members represent specialty societies recognized by the American Board of Medical Specialties. ACEP is the only emergency medicine organization with a seat at the RUC table. The RUC representatives are not there to advocate for their individual specialties, but rather to contribute their specialized content knowledge to the deliberating body and vote on the presented code values. Each specialty society also has a RUC advisor and potentially an alternate RUC advisor whose job it is to represent that specialty and advocate on behalf of its members.

Each society represented on the RUC, including ACEP, works through the following process:

1. Conduct Surveys: The specialty societies send surveys to their physicians to obtain data on the amount of work involved in a service. The societies are required to survey at least 30 practicing physicians. Each code includes three components (work associated with the service, practice expense, and malpractice expense), but the survey is focused on the work component, asking respondents questions about the time and intensity of the services under review. After conducting such surveys, the specialty societies and their RUC advisors review the results and prepare their value recommendations.
2. Review Results and Prepare Recommendations
   
3. Present Recommendations to the Full RUC: The specialty societies’ RUC advisors present their recommendations to voting RUC representatives. Convincing the RUC to revalue a code is tricky because, due to a budget neutrality requirement under the Medicare PFS, any increases in one code value must have a corresponding decrease in value from all other codes.
4. RUC Votes on Specialty Society Recommendations: The RUC may vote to accept a specialty society’s recommendation, refer it back to the specialty society, or modify it. Final recommendations sent to CMS must be adopted by a two-thirds majority of the RUC members.
5. RUC Sends Final Recommendations, CMS Reviews Them: CMS reviews the RUC recommendations through the formal Medicare PFS rulemaking process. The PFS proposed rule is typically released annually in July, followed by the final rule in November, and affects physician payment rates for the following calendar year.

ACEP on RUC

As the only voice for emergency medicine on the RUC, ACEP has an appointed RUC representative and an alternate RUC representative who both attend RUC meetings as voting representatives of the greater medical community. In 2018, ACEP was represented on the RUC by Jennifer Wiler, MD, MBA, FACEP, with Michael Gerardi, MD, FACEP, as our RUC alternate representative. Our current RUC representative is John Proctor, MD, MBA, FACEP.

As ACEP’s RUC advisors in 2018 when the 2020 codes values were considered, Ethan Booker, MD, FACEP, and Jordan Celeste, MD, FACEP, presented our data to the RUC for consideration and voting.

ACEP’s RUC advisor team also includes staff members David McKenzie, CAE, ACEP’s reimbursement director, and Adam Krushinskie, MHA, ACEP’s reimbursement manager, who conduct the detailed membership surveys as part of the RUC process. This team provides information and evidence for our RUC advisors to use during their presentations to the committee.

What Did ACEP Do for You?

In 2017, CMS identified the emergency department evaluation and management (E/M) codes as potentially mis-valued. These codes, which include five levels of complexity (Levels 1–5), are billed by the majority of our members and represent roughly 85 percent of emergency medicine services.

ACEP’s RUC team managed the RUC’s review of these codes, first surveying a random sample of ACEP members using a standardized RUC survey instrument and then using the survey results to develop recommendations for the RUC. The survey results are validated using comparisons of trusted existing codes with similar times and intensity to the codes under review. Supporting data from published research is also used to supplement the survey results and recommendations. As noted above, an increase in one specialty’s code results in decreasing another specialty’s code to ensure zero-sum-game budget neutrality. During the last RUC cycle, only approximately 9 percent of codes identified as potentially mis-valued received value increases.

Our advisors knew we had to provide a compelling argument to convince at least two thirds of the other RUC voting specialties to support our recommended values. Using the data collected through our member surveys, Dr. Booker and Dr. Celeste convinced the RUC the ED E/M codes were undervalued. The RUC approved increases of 1.5 percent to 6.5 percent for Levels 1 through 4. For now, Level 5 values will remain stable.

In the calendar year 2020 PFS proposed rule, CMS accepted the RUC’s recommendation. If this proposal is finalized in November, in 2020 we could see an increase in ED E/M Medicare payments of approximately $137 million annually, before any additional budget neutrality adjustments.

What’s Next?

CMS has proposed to accept RUC’s recommendations, but CMS must finalize its proposal in the PFS final rule in November for these increases to become effective in 2020. ACEP annually submits extensive comments on the PFS proposed rule, and our comments this year will strongly urge CMS to finalize its proposal.

Even if CMS finalizes its proposal, the RUC team’s job is not done. They will remain strong advocates for emergency medicine and for the entire house of medicine by continuing to review and vote on value changes for other PFS codes, making sure the levels of all codes under the PFS are appropriate and fair.

If you’d like to learn more about the RUC process and the work of our RUC team, please contact David McKenzie, ACEP’s reimbursement director, at dmckenzie@acep.org.

Mr. Davis is ACEP’s regulatory affairs director.