The health care market is confusing. It doesn’t follow the normal rules of supply and demand, costs sky rocket and plummet, and transparency is all but entirely lacking. At the heart of this mess is a committee of medical specialists, including oncologists, cardiologists and dermatologists, who meet behind closed doors three times a year. This committee, known as the RUC, is overseen by the American Medical Association. It’s primary job is to establish set the “relative values” (which translate to prices) of all 8,000 – 10,000 medical procedures on record. By all accounts, these meetings get heated: the American College of Surgeons votes for a higher value for a procedure prized by the American College of Radiologists, but the radiologists are, in turn, expected to increase the value of a new surgery, which promises to help surgeons charge more. The Centers for Medicare and Medicaid then accept the RUC’s list of “relative values,” translate them into dollar prices, and set the price list for Medicare — a list that’s used a baseline by nearly every private insurance agency. To put that another way, these shadowy, behind-closed-door RUC meetings, in which doctors debate their own pay, do more to determine health care prices than anything else in this country.
