I 
112TH CONGRESS 
1ST SESSION H. R. 1256 
To amend title XVIII of the Social Security Act to require the use of 
analytic contractors in identifying and analyzing misvalued physician 
services under the Medicare physician fee schedule and an annual review 
of potentially misvalued codes under that fee schedule. 
IN THE HOUSE OF REPRESENTATIVES 
MARCH 30, 2011 
Mr. MCDERMOTT introduced the following bill; which was referred to the 
Committee on Energy and Commerce, and in addition to the Committee 
on Ways and Means, for a period to be subsequently determined by the 
Speaker, in each case for consideration of such provisions as fall within 
the jurisdiction of the committee concerned 
A BILL 
To amend title XVIII of the Social Security Act to require 
the use of analytic contractors in identifying and ana-
lyzing misvalued physician services under the Medicare 
physician fee schedule and an annual review of poten-
tially misvalued codes under that fee schedule. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE; FINDINGS. 
(a) SHORT TITLE.—This Act may be cited as the 
‘‘Medicare Physician Payment Transparency and Assess-
ment Act of 2011’’. 
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(b) FINDINGS.—Congress finds the following: 
(1) The Centers for Medicare & Medicaid Serv-
ices (CMS) has not had sufficient resources or com-
mitment to undertake the needed surveys and ana-
lytic research needed to keep the Medicare resource- 
based relative value scale (RBRVS) current with 
changes in medical, surgical, consultative, proce-
dural, and diagnostic practices. For the last 20 
years, the American Medical Association has spon-
sored the Specialty Society Relative Value Scale Up-
date Committee (RUC) as a good faith effort to sup-
port CMS in the task of developing the physician fee 
schedule but a more robust process is needed. 
(2) CMS has depended on the AMA’s RUC for 
recommendations as to the values assigned to Medi-
care service codes for over 90 percent of all code 
changes over the last 19 years. 
(3) Although primary care physicians provide 
about 44 percent of Medicare physician visits, they 
constitute only 1⁄6 to 1⁄13 of the membership of the 
RUC. 
(4) The RUC lacks voting transparency and re-
lies on self-reported and unrepresentative survey 
data that present serious conflict-of-interest con-
cerns. 
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(5) The Medicare Payment Advisory Commis-
sion has found that while the RUC tends to identify 
and correct undervalued codes, it does not have the 
same incentives to find and correct overvalued codes. 
Specialists, especially those who derive the majority 
of their income through procedural codes, have no 
incentive to reduce the value of potentially over-
valued codes, even though the requirements for phy-
sician work in many procedures should generally re-
duce as time passes and proficiency increases. 
(6) The assignment of relative values to the 
evaluation and management (E/M) codes was the 
most unsubstantiated component of the original 
RBRVS and has not been systematically and sci-
entifically studied since the institutionalizing of 
RBRVS. 
(7) The advent of electronic health records will 
require new methods to assess the intensity and 
work effort of the E/M codes. 
(c) PURPOSE.—It is the purpose of this Act to re-
quire the Secretary of Health and Human Services to con-
sider the recommendations of independent, analytic con-
tractors that are responsible for initially identifying and 
analyzing misvalued Medicare physician services and to re-
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quire an annual review of potentially misvalued codes 
under the Medicare fee schedule. 
SEC. 2. REQUIRING USE OF ANALYTIC CONTRACTORS IN 
IDENTIFYING AND ANALYZING MISVALUED 
MEDICARE PHYSICIAN SERVICES AND AN-
NUAL REVIEW OF POTENTIALLY MISVALUED 
CODES UNDER MEDICARE FEE SCHEDULE. 
Section 1848(c)(2)(K) of the Social Security Act (42 
U.S.C. 1395w–4(c)(2)(K)), as amended by section 
3134(a) of the Patient Protection and Affordable Care Act 
(Public Law 111–148), is amended— 
(1) in clause (i), by striking ‘‘periodically’’ and 
inserting ‘‘annually’’; and 
(2) in clause (iii)— 
(A) subclause (I), by inserting before the 
period at the end the following: ‘‘, but only to 
the extent consistent with the use of analytic 
contractors under subclause (III)’’; and 
(B) in subclause (III)— 
(i) by striking ‘‘may use’’ and insert-
ing ‘‘shall use’’; and 
(ii) by adding at the end the fol-
lowing: ‘‘This subclause shall not be con-
strued as prohibiting the Secretary from 
making modifications to one or more codes 
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under the fee schedule without use of the 
analytic contractors.’’. 
Æ 
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