When Harinath Sheela was busiest at his gastroenterology clinic, it seemed he could bend the limits of time.

Twelve colonoscopies and four other procedures was a typical day for him, according to Florida records for 2012. If the American Medical Association's assumptions about procedure times are correct, that much work would take about 26 hours. Sheela's typical day was nine or 10.

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 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. But in reality, the total time the physician spends with each patient is about half that - roughly 30 minutes, according to medical journals, interviews and doctors' records.

Indeed, the standard appointment slot is half an hour.

Inflated values

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:

• To determine how long a procedure takes, the AMA relies on surveys of doctors conducted by the associations representing specialists and primary care physicians. The doctors who fill out the surveys are informed that the reason for the survey is to set pay. Increasingly, the survey estimates have been found so improbable that the AMA has had to significantly lower them, according to federal documents.

• The AMA committee, in conjunction with Medicare, has been seven times more likely to raise estimates of work value than to lower them, according to a Post analysis of federal records for 5,700 procedures. This happened despite productivity and technological advances that should have cut the time required.

• If AMA estimates of time are correct, hundreds of doctors are working improbable hours, according to an analysis of records from surgery centers in Florida and Pennsylvania. In some specialties, more than one in five doctors would have to have been working more than 12 hours on average on a single day - much longer than the 10 or so hours a typical surgery center is open.

Florida records show 78 doctors - gastroenterologists, ophthalmologists, orthopedic surgeons and others - who performed at least 24 hours worth of procedures on an average workday.

Some former Medicare chiefs think the problem arises from giving the AMA too much influence over physician pay. Hospital fees are determined separately.

"What started as an advisory group has taken on a life of its own," said Tom Scully, who was Medicare chief during the George W. Bush administration and is now a partner in a private equity firm that invests in health care. "The idea that $100 billion in federal spending is based on fixed prices that go through an industry trade association in a process that is not open to the public is pretty wild."

In response, the chair of the AMA committee that sets the values, Barbara Levy, a physician, acknowledged that "all of the times are inflated by some factor" - though not by the same amount.

But she defended the accuracy of the values assigned to procedures, saying that the committee is careful to make sure that the relative values of the procedures are accurate - that is, procedures involving more work are assigned larger values than those that involve less. It is up to Congress and private insurers then to assign prices based on those values.

"None of us believe the numbers are fine-tuned," Levy said. "We do believe we get them right with respect to each other."

Moreover, the committee has reduced the valuations of more than 400 procedures in recent years to address such concerns, AMA officials said.

Over that time, Medicare officials have increasingly looked askance at the AMA estimates. But even though the AMA figures shape billions in federal Medicare spending and billions more in spending from private insurers, the government is ill-positioned to judge their accuracy.

For one thing, the government doesn't appear to have the manpower. The government has about six to eight people reviewing the estimates provided by the AMA, government officials said, but none of them do it full time.

By contrast, hundreds of people from the AMA and specialty societies contribute to the AMA effort. The association "conservatively" has estimated the costs of developing the values at about $7 million in time and expense annually. The AMA and the medical societies, not the government, develop the raw data upon which the analysis is based.

Over the past decade, Medicare's payments to doctors have risen quickly. Medicare spending on physician fees per patient grew 58 percent between 2001 and 2011, mostly because doctors increased the number of procedures performed but also because the price of those procedures rose, according to MedPAC, an independent federal agency that advises Congress about Medicare.

Other groups that make recommendations to the government are governed by the Federal Advisory Committee Act, which requires that meetings be public and that documents be publicly available. But those requirements do not apply to the AMA committee, officials said, because the AMA is not considered an advisory committee.

Even so, the committee's influence on federal spending over time has been expansive: In some years, Medicare officials have accepted the AMA numbers at rates as high as 95 percent.

'Highly political'

The fundamental question is difficult, even philosophically: What should a doctor make?

The forces that normally determine prices - haggling between buyers and sellers - often don't apply in health care. Prices are hard to come by; insurers do most of the buying; sick patients are unlikely to shop around much.

In the current point system, every procedure is assigned a number of points - called "relative value units" - based on the work involved, the staff and supplies, and a smaller portion for malpractice insurance.

Every year, Congress decides how much to pay for each point - this year, for example, the government initially assigned $34.02 per point, though prices vary somewhat with location and other factors.

This point system is critical because it doesn't just rule Medicare payments. Roughly four out of five insurance companies use the point system for the basis of their own physician fees, according to the AMA. The private insurers typically pay somewhat more per point than does Medicare.

Once the system developed by the Harvard researchers was initiated, however, the Medicare system faced a critical problem: As medicine evolved, the point system had to be updated. Who could do that?

The AMA offered to do the work for free.

Today, the 31-member AMA committee that makes the update recommendations to Medicare - it is known as the Relative Value Update Committee, or "RUC" - consists of 25 members appointed by medical societies and six others. The chair is appointed by the AMA.

To inform their decisions, the committee relies on surveys submitted by the relevant professional societies. For example, in setting the value for a colonoscopy, the committee has turned to the American Gastroenterological Association and a similar group for information.

Sometimes the doctors within a specialty will overestimate the value of their work, Levy said. When that happens, the committee has increasingly decided to significantly lower their estimates of the work involved.

But critics of the AMA process, including former Medicare chiefs and the Harvard researchers who created the system, say that biased surveys and other conflicts of interest make the results unreliable.

The current set of values "seems to be distorted," said Professor William Hsiao, an economist at the Harvard School of Public Health who helped develop the point system. "The AMA fought very hard to take over this updating process. I said this had to be done by an impartial group of people. This is highly political."

Exaggerated estimates

Federal law makes the importance of time explicit: The work points assigned to a procedure will reflect the "physician time and intensity in furnishing the service" and includes the physician's time before, during and after a procedure. Every year, the Medicare system publishes its time estimates for every service, which are based on AMA surveys.

To examine the plausibility of the estimated times, The Washington Post analyzed the records for doctors who work in outpatient surgery clinics in Florida.

The doctors included ophthalmologists, hand surgeons, orthopedic surgeons, gastroenterologists and others.

The Post chose the outpatient surgery clinics for review because their surgery records for Medicare and private payers were publicly available. The calculations of physician time used by The Post are conservative because they do not include the procedures that the doctors performed at hospitals, where many such doctors also see patients. The counts also exclude secondary procedures performed on a given patient, as well as follow-up visits.

Even so, for this group of doctors, the time estimates made by Medicare and the AMA appear significantly exaggerated.

If the AMA time estimates are correct, then 41 percent of gastroenterologists, 23 percent of ophthalmologists and 17 percent of orthopedic surgeons typically were performing 12 hours or more of procedures in a day, which is longer than the typical outpatient surgery center is open, The Post found in the Florida data.

Additionally, if the AMA estimates are correct, more than 3 percent of ophthalmologists and internists, and more than 2 percent of orthopedic surgeons are squeezing more than 24 hours of procedures into a single day.

Florida is not unique. In a similar review of nine endoscopy clinics in Pennsylvania, The Post found 25 of 59 doctors at nine Pennsylvania gastroenterology clinics performed an average 12 hours or more of procedure time at least one day per week, with two totaling over 24 hours, rates similar to the Florida pattern.

Ophthalmologist David Shoemaker is among the busiest doctors in Florida, performing 3,594 cataract surgeries and similar procedures last year. His workload of 30 to 40 surgeries per day on Mondays and Tuesdays amounts to 30-plus-hour workdays if AMA time estimates were correct. Yet he works only about 10½ hours those days.

The AMA's Levy said the committee has developed other ways to estimate values that don't depend on time.

The critics don't "get the concept of where the committee is in 2013," Levy said. "We've evolved a bunch of processes that make them better than they were when Harvard did it."

Whatever their methods, however, the AMA panel has been raising the work points for procedures.

Between 2003 and 2013, the AMA and Medicare have increased the work values for 68 percent of the 5,700 codes analyzed by The Washington Post, while decreasing them for only 10 percent.

While advances in technology and skill should have reduced the amount of work required, the average work value for a code rose 7 percent over that decade, largely because officials raised the value of doctors' visits. The rise came in addition to allowances for inflation and other economic factors.

When discussing the rise in the nation's bills for physicians, AMA officials note that they only assign points to procedures - so the Medicare bill depends upon how much the federal government decides to spend for each point.

Officials determine that spending by several complex formulas laid out in federal rules. One of them forces Medicare to lower how much it pays per point when work values rise significantly. Every year since 2003, however, the other formulas have been overridden by Congress, which has adjusted the payments independently.

That means it's difficult to definitively link the nation's rising Medicare bill to the increasing work values set by the AMA. However, critics say the AMA's time exaggerations undoubtedly help inflate the prices of many procedures.

Economic incentive

Two problems arise when some procedures are overvalued, according to the critics. First, obviously, it means some patients and insurers are paying too much. Second, doctors may be more likely to perform those procedures than they otherwise would be.

Indeed, while health experts worry that many people who should be getting colonoscopies are not, it appears that some patients are getting too many.

Average-risk patients who have a colonoscopy that shows no signs of trouble are not supposed to receive another for 10 years, according to Medicare guidelines.

But according to researchers at the University of Texas Medical School, about 46 percent of patients were getting another colonoscopy within seven years.

The finding, based on a review of 24,000 patient records and reported last year in the Archives of Internal Medicine, said that such colonoscopies were more likely to be performed by doctors rated as "high volume" providers.

One of the study's authors, James Goodwin, a geriatrician at the University of Texas in Galveston, says doctors make decisions based on a large number of factors. But it's foolish, he said, to ignore the financial angles.

"Economic incentives in medicine are like the force of gravity," Goodwin said. "To pretend they don't exist is crazy. They're there."