Physi­cian pay­ment data may drive hospi­tal, in­surer de­ci­sions

Modern Healthcare - - NEWS - By Joe Carl­son

In­sur­ers want to know which doc­tors rou­tinely or­der the most ser­vices and the costli­est treat­ments. Hos­pi­tals want to know which physi­cians to part­ner with for ac­count­able care pro­grams. Fraud in­ves­ti­ga­tors and re­searchers want to know who is or­der­ing un­nec­es­sary ser­vices or billing ex­ces­sively. Con­sumer groups and in­di­vid­ual con­sumers want to know which doc­tors have the most ex­pe­ri­ence with com­plex pro­ce­dures.

All these groups will be closely ex­am­in­ing HHS’ mas­sive re­lease last week of in­for­ma­tion on 2012 Medi­care Part B pay­ments to in­di­vid­ual physi­cians and other providers. The wa­ter­shed pub­li­ca­tion of the long-sought data is part of what many ex­perts see as a bur­geon­ing new era of trans­parency in health­care pric­ing, qual­ity of care and use of ser­vices.

“For too long, the only in­for­ma­tion on physi­cians read­ily avail­able to con­sumers was physi­cian name, ad­dress and phone num­ber,” Jonathan Blum, CMS prin­ci­pal deputy ad­min­is­tra­tor, said in a writ­ten state­ment. “This data will, for the first time, pro­vide a bet­ter pic­ture of how physi­cians prac­tice in the Medi­care pro­gram.”

The data­base in­cludes 9.2 mil­lion lines de­scrib­ing trans­ac­tions worth $77 bil­lion by 880,000 physi­cians, physi­cian prac­tices and other providers cer­ti­fied to col­lect from Medi­care. It in­cludes in­di­vid­ual physi­cians’ names and of­fice lo­ca­tions, the ex­act ser­vices for which they billed Medi­care, the aver­age pay­ments for each ser­vice and the num­ber of pa­tients who re­ceived each ser­vice. The data do not in­clude pa­tient iden­ti­ties. The CMS ex­pects to re­lease sim­i­lar data troves on Part B pay­ments an­nu­ally.

“The in­sights that can be gained here are near lim­it­less,” said Dr. Gra­ham Hughes, chief med­i­cal of­fi­cer of busi­ness-an­a­lyt­ics firm SAS. “The fo­cus will be on uti­liza­tion, prac­tice pat­terns and prac­tice vari­a­tion. I have heard di­rectly from some of our (hospi­tal) cus­tomers that they are por­ing over this data as we speak.”

The data re­lease came over the strong ob­jec­tions of or­ga­nized medicine, which had fought to block the re­lease for decades, ar­gu­ing that such in­for­ma­tion would vi­o­late doc­tors’ pri­vacy rights. “Re­leas­ing the data with­out con­text will likely lead to in­ac­cu­ra­cies, mis­in­ter­pre­ta­tions, false con­clu­sions and other un­in­tended con­se­quences,” said Dr. Ardis Dee Hoven, pres­i­dent of the Amer­i­can Med­i­cal As­so­ci­a­tion. The data “will not al­low pa­tients or pay­ers to draw mean­ing­ful con­clu­sions about the value or qual­ity of care.”

Me­dia re­ports have high­lighted the lim­i­ta­tions of the data, such as the fact that billings listed un­der a sin­gle physi­cian code may re­fer to all doc­tors in a large physi­cian prac­tice. In ad­di­tion, billings may have in­cluded costs for ex­pen­sive drugs as well as of­fice space, non­physi­cian providers and other staff.

Still, it’s ex­pected that the data will in­form im­por­tant busi­ness de­ci­sions by health­care in­dus­try groups. Hos­pi­tals can now take a more de­tailed look at in­di­vid­ual physi­cians’ prac­tice pat­terns and their pa­tient bases and de­cide whether to part­ner with them or try to ac­quire their prac­tices. The data may re­veal which doc­tors are treat­ing the most pa­tients in each ZIP code and for what di­ag­noses. That could prove valu­able as hos­pi­tals and physi­cians form ac­count­able care or­ga­ni­za­tions and other de­liv­ery net­works.

In­sur­ers and self-in­sured em­ploy­ers also plan to ex­am­ine the in­for­ma­tion closely, since the Medi­care data set on physi­cian billing is far larger than what most of them could have pre­vi­ously ac­cessed. They want to know which doc­tors or­der ex­pen­sive ser­vices, pro­ce­dures and drugs more than their peers. The data could help them choose doc­tors for their nar­rower, value-based net­works and so-called tiered net­works of pre­ferred providers.

Some of the early find­ings from Mod­ern Health­care’s anal­y­sis of the data show that:

■ Rou­tine of­fice vis­its ac­counted for the sin­gle largest share of Medi­care physi­cian billings in 2012 even though they amounted to just one-sev­enth of the $77 bil­lion in pay­ments cov­ered in the data re­lease.

■ Many of the high­est-pay­ing pro­ce­dures in­clude the pur­chase and ad­min-

is­tra­tion of drugs. The sin­gle high­est­pay­ing ser­vice in Medi­care Part B is $25,730 for ad­min­is­tra­tion of prostate cancer drug Provenge for pa­tients with “cas­tra­tion lev­els” of testos­terone and ev­i­dence of tu­mor pro­gres­sion.

■ Oph­thal­mol­o­gists are among Medi­care’s high­est-paid spe­cial­ists—a find­ing al­ready draw­ing scru­tiny from pol­i­cy­mak­ers and watch­dogs wor­ried about waste and fraud. But many of the high­est-pay­ing codes for eye doc­tors re­late to the use of Lu­cen­tis, a branded in­jectable drug for mac­u­lar de­gen­er­a­tion that costs $2,000 a dose.

The rel­a­tively large amounts re­ceived by some physi­cian spe­cial­ties drew at­ten­tion from con­sumer groups. Last year, HHS’ Of­fice of the In­spec­tor Gen­eral rec­om­mended that the Medi­care pro­gram fo­cus its fraud scru­tiny on in­di­vid­ual physi­cians billing more than $3 mil­lion a year.

“If I was a pol­i­cy­maker, I would want to take a hard look at whether we are pay­ing higher prices than we should for some of those

“There is an enor­mous amount of en­tirely le­gal but in­ap­pro­pri­ate pat­terns of care that are pro­vided un­der Medi­care.”

—Bill Kramer, ex­ec­u­tive di­rec­tor of na­tional health pol­icy at the Pa­cific Busi­ness Group on Health

pro­ce­dures, or if there are ex­ces­sive pro­ce­dures be­ing done,” said Robert Krughoff, pres­i­dent of con­sumer or­ga­ni­za­tion Con­sumer’s Check­book, which sued for re­lease of Part B data in 2006.

The pub­lic quickly learned that Medi­care’s high­est-paid doc­tor is Florida oph­thal­mol­o­gist Dr. Salomon Mel­gen, who re­ceived $20.8 mil­lion from the pro­gram in 2012 alone and is a close as­so­ciate of U.S. Sen. Robert Me­nen­dez (D-N.J.). Mel­gen’s de­fense lawyer has in­sisted all the pay­ments were le­gal. Oph­thal­mol­ogy in gen­eral came un­der ag­gres­sive scru­tiny.

The data also could be help­ful to con­sumers in choos­ing doc­tors. Krughoff said the data of­fer them rich in­for­ma­tion on which doc­tors have the most ex­pe­ri­ence per­form­ing com­plex pro­ce­dures. “There is quite a bit of ev­i­dence that says ex­pe­ri­ence mat­ters in many types of pro­ce­dures,” he said.

Re­searchers will be comb­ing through the data to find ev­i­dence of prac­tice pat­tern vari­a­tion by ge­o­graphic lo­ca­tion. Ex­perts say such anal­y­sis is im­por­tant not just in weed­ing out waste and fraud, but also in pro­tect­ing pa­tients from risk of in­juries or in­fec­tions from un­nec­es­sary ser­vices and pro­ce­dures.

“There is an enor­mous amount of en­tirely le­gal but in­ap­pro­pri­ate pat­terns of care that are pro­vided un­der Medi­care,” said Bill Kramer, ex­ec­u­tive di­rec­tor of na­tional health pol­icy at the Pa­cific Busi­ness Group on Health, which rep­re­sents large em­ploy­ers.

While em­ploy­ees of the group’s mem­ber com­pa­nies gen­er­ally aren’t in Medi­care, Part B data will still have value, par­tic­u­larly when com­bined with in­for­ma­tion from all-claims data­bases. “The best providers will thrive when we all know who the best doc­tors and hos­pi­tals are,” Kramer said. “It is ul­ti­mately how we are go­ing to im­prove the whole health­care sys­tem.”

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