As we all acknowledge, there are wide ranges in what doctors make depending on their specialty. Doctors in our physician communities often comment that certain specialties, particularly the primary care specialties, are underpaid for what they do, and wonder what can be done to change this. What a lot of physicians don’t know about, though, is that there exists a committee run by the AMA that actually makes recommendations to the federal government (specifically CMS, the Centers for Medicare & Medicaid Services) about the resources required to provide medical services. This in turn influences how many RVUs are assigned to each physician service, and how much doctors are paid for those services. This committee is known as the American Medical Association (AMA) / Specialty Society Relative Value Scale Update Committee (RUC). Below, we’ll go into more detail about what this committee is, how it works, and what it ultimately translates to in terms of determining which specialties are compensated better.
Disclaimer/Disclosure: Our content is for generalized educational purposes. Laws and taxes vary based on location and while this information is accurate to the best of our knowledge, it may not be up to date or apply in your location. We are not formal financial, legal, or tax professionals and do not provide individualized advice specific to your situation. You should consult these as appropriate and/or do your own due diligence before making decisions based on this page. To learn more, visit our disclaimers and disclosures.
Article Navigation
What is the Relative Value Scale Update Committee (RUC)?
As you likely know, each CPT code is associated with a certain number of RVUs. The RUC is a committee that has been assembled to decide how many RVUs should be assigned to each CPT code, and make that recommendation to CMS. CMS is not obligated to follow their recommendation, but historically follows a large percentage of them ranging from ~75-90%. This then sets Medicare payments for each service, as it directly translates to the Medicare Physician Payment Schedule.
The RUC meets three times a year to revisit its recommendations and make modifications as needed based on whether they think something is over or undervalued, and will send their recommendations to CMS each time. The dates are closely aligned with when the CPT Editorial Panel meets and when CMS does its annual updates to the Medicare Payment Schedule.
The RUC was originally formed in 1991 after Congress mandated the Resource-Based Relative Value Scale (RBRVS) in 1989, with the purpose of guiding CMS on the relative values of the various Current Procedural Terminology (CPT) codes.
As you can see, the RUC has a lot of power in how different specialties are ultimately reimbursed. This applies even though they are only formally advising CMS, because so many other insurance payors base their fee schedules on what CMS does.
Who is on the Relative Value Scale Update Committee (RUC), and who else is involved in the RUC decisions?
The RUC is organized in conjunction with the AMA and currently consists of 32 volunteer physicians and health care professionals. 22 members of this committee are composed of representatives appointed by their respective specialty medical boards. There are also 4 seats that rotate, including one seat that is reserved for a primary care representative, two for internal medicine subspecialties, and one for a specialty whose medical society doesn’t have a permanent seat. The remaining 6 seats belong to the chair of the RUC, the co-chair of the RUC’s HCPAC Review Board (see below), the chair of the Practice Expense Subcommittee and representatives of the American Medical Association, the American Osteopathic Association and the CPT Editorial Panel.
*The number and makeup of this committee has changed over the years, but this is currently accurate to the best of our knowledge.
There is also an Advisory Committee, which has an appointed physician representative from each of the ~125 specialty societies of the AMA House of Delegates. Additional physicians from other specialty societies may be invited to weigh in on specific RVUs for coding changes relevant to those specialties. The members of these specialty advisory committees must be different from those that are on the RUC so that those specialties have someone advocating for them but also someone separate to evaluate things more from the 30,000 foot view and take into consideration what’s best for everyone as a hold.
You saw above that the co-chair of the HCPAC (Health Care Professionals Advisory Committee) Review Board on the RUC. This was created because of the need to include some other practitioners and allied health professionals in the process, as they also use CPT to get paid for services to Medicare patients. These include nurses, physician assistants, optometrists, podiatrists, chiropractors, occupational therapists, physical therapists, psychologists, audiologists, speech pathologists, social workers, registered dieticians, and marriage and family therapists. Together with three physician members of the RUC, representatives for these groups make up the RUC HCPAC Review Board to develop RVU recommendations for codes used principally by non MD/DO professionals.
The Practice Expense Advisory Committee (PEAC) was set up by the RUC to ensure that the practice expense component of the RVU calculation was accurate and accounted for differences in how different practices or specialties may allocate practice expenses, as there’s no uniform methodology.
How does the Relative Value Scale Update Committee (RUC) make its decisions and recommendations?
If you remember what an RVU is, it takes into consideration the amount of work it takes to perform a service by physicians and staff, the expenses associated with it including things like equipment and medical supplies needed, and the professional liability and insurance costs associated with it. The physician work component and the practice expense component make up the vast majority of the RVU. Payments are ultimately calculated by multiplying the combined costs by a conversion factor monetary amount determined by CMS and adjusting for geographic differences in the costs of resources.
Learn more about what an RVU is.
In order to try to fairly assign RVUs to each CPT code, of which there are ~10,000, it collects as much data as possible in the form of surveys to physicians. There are different thresholds of respondents needed depending on how often the code is used, ranging from at least 30 physicians to at least 75 physicians. They also encourage specialty societies to help them gather data, and members of the Advisory Committee will designate an RVS Committee for their specialty is surveyed with a survey method developed by the RUC.
Three times a year, the designated specialty society advisors and remainder of the RUC committee will attend a meeting, where the specialty advisors will present the recommendations from their respective societies based on the surveys. The RUC will consider new and revised, as well as existing, codes based on the codes that have been requested for review by either CMS or the RUC or new changes to the CPT coding that have been created by the CPT editorial panel, as well as feedback from the specialty surveys and the Specialty Advisory Committees. After discussion, they will submit their recommendations to CMS to be approved or altered before going into effect.
Of course, the behind the scenes is much more complicated. After the RUC, CMS, and the CPT Editorial Panel have received the new or revised codes and CMS and the RUC has identified issues where codes could be misvalued, that information is sent to the RUC staff who prepare a Level of Interest form that summarizes specific CMS requests and other priorities for the panel. The RUC Advisory Committee members and specialty societies staff members will then review this form and decide if they want to survey their members, comment on recommendations, or let a revised code go because it doesn’t change much or affect their specialty. For the ones they want to survey their societies on, the AMA will give them a survey instrument that goes out to physicians, along with relevant data. After the surveys are conducted, the specialty committees will compile the results and prepare recommendations for the RUC. Often times they are asked to prepare a consensus recommendation with other affected societies if there are codes relevant to multiple specialties. Then those recommendations are given to the RUC before the meeting for review, before being formally presented at the RUC meeting by the Specialty Advisors. Members of the RUC committee are then allowed to ask as many questions as they want and force the specialty advisors to defend their recommendations. The RUC will then vote to adopt the recommendation or refer it back to the specialty society for modifications. Deliberations can get contentious, especially if it’s felt that one specialty is exaggerating the costs or work associated with a code. If an agreement cannot be reached, occasionally there will be a “facilitation” ad hoc committee created by the RUC to develop a recommendation acceptable to both the RUC and the presenting specialty.
The final recommendation has to be approved by a ⅔ majority of the RUC.
Once everything has been settled, the RUC will submit final recommendations to CMS, where CMS has its own process for reviewing recommendations before issuing the tentative Medicare Physician Payment Schedule in July that includes recommendations and proposals, and ultimately the version which is finalized in November.
The AMA does try to make the process transparent to physicians and the public by publishing meeting dates and minutes as well as recommendations and vote totals for each service that they evaluated on their website.
Why doesn’t the RUC just increase the number of RVUs for each CPT code so physicians can get paid better?
Unfortunately, it’s not this easy. From the 30,000 foot view, the RUC is not able to increase the size of the Medicare payment pot, but rather has to dole out the relative values from a fixed pot. What this means is that giving one CPT code more RVUs inherently means that another gets less – and what this translates to is that giving one specialty more money means there’s less money for another specialty.
We, of course, think that we should be able to advocate for the pot to grow, but that’s beyond the scope of this article.
Is the RUC a good system?
As you can imagine, this is a contentious system. You probably had your own feelings reading through this article about areas where things may be fair or not fair, who’s represented, who should have more representation, and whether we as a society are valuing the right things in payments. Each society is left to fend for itself and fight for its voice to be heard. As you can imagine, there are lots of politics involved. The counterargument made by those who are advocates of the RUC is of course that it at least allows physicians to have a seat at the table for how decisions are made in regards to Medicare payments. Imagine this in the hands of politicians or other employees of CMS. Smaller specialties would likely struggle more to have a voice.
Conclusion
The RUC is a relatively small committee that wields a lot of power, as it is instrumental in determining how each CPT code is compensated. It’s composition and processes are debated widely amongst those that study it. The TLDR: It’s not perfect, but for the moment, it’s what we have. If you want change, advocate for it!
Additional resources for doctors to learn about compensation
Explore our articles and resources on doctor compensation and salaries: