One of the provisions of the new health care law is the Independent Payment Advisory Board. If there was ever was a better example of history repeating itself, I cannot imagine a better example than the newly minted IPAB and the former Soviet Bureau of pricing, Goskomtsen.
Gomkomtsen was charged with setting all prices within the former Soviet Union. Incorrect pricing resulted in massive and chronic mis-allocation of resources of the in communist state. Arguably, incorrect pricing may have been the single most important factor in creating such a dysfunctional economic state.
The approach to setting prices was based upon examining inputs and cost of production. The information used for these calculations was almost always either incorrect at the time of collection or became incorrect shortly thereafter. This approach to pricing shares remarkable similarities with the calculations underlying the RBRVS (from Wikipedia).