The Centers for Medicare & Medicaid Services (CMS) has just released data showing that Medicare paid $77 billion to physicians and medical facilities in 2012. This information has been released to the public “as part of the Obama Administration’s efforts to make our healthcare system more transparent…” The Health Secretary, Kathleen Sebelius, thinks that “This data will help fill that gap by offering insight into the Medicare portion of a physician’s practice.”
This information had long been kept under lock and key by the American Medical Association (AMA), as reported by CNN Money, but thanks to a ruling by a U.S. District judge in 2013, this information is now available to the public. It was previously kept private because of a 34-year old injunction that prevented the government from releasing this information.
The 1979 AMA Injunction Vacated by U.S. District Judge Howard
In 1979, a Florida federal court ruled in favor of the AMA, granting them an injunction to keep Medicare payment information private on behalf of physician’s rights. This was overturned by U.S. District Judge Marcia Morales Howard in May 2013, after she stated that the Privacy Act had been narrowed by evolving case law in the 30 years since, and that Medicare payment information should no longer remain private.
The President of the AMA, Ardis Dee Hoven, made a statement after the ruling:
“Medicine has stood its ground during the last 34 years to defend an injunction that favored individual rights and protected innocent physicians from becoming targets of suspicion. The American Medical Association is considering its options on how best to continue to defend the personal privacy interests of all physicians.”
The AMA has feared that people would draw conclusions based on the figure alone, and this sentiment was also reiterated by CMS upon its release.
CMS: ‘Physicians Don’t Get all of the Medicare Money’
According to the CMS, one reason that one should not jump to conclusions over the $77 billion is that not all of the money goes straight into the physician’s pocket.
For example, CMS points out that some of the Medicare payment has to be paid by the physician back to the pharmaceutical companies, or to other healthcare providers that took part in the healthcare.
However, this is assuming that the physicians are not over-billing Medicare for patient healthcare, which is also known as fraud.
Should Taxpayers be Concerned about Medicare Fraud?
In 2013, The Department of Health and Human Services released a report stressing the potential for Medicare fraud, particularly among “clinicians associated with high cumulative payments” to “improve the Medicare program’s integrity efforts.” This was a very polite way of saying: Fraud is very possible among physicians that get many Medicare payments. This is not a stretch of the truth by any means, because back in 2009, one-third of the physicians that received at least $3 million in Medicare payments were flagged for suspicious billing activity regarding Medicare. This includes over $34 million in over-payments by Medicare to these physicians.
2% of the physicians listed on the 2012 reports brought in almost 25% of the Medicare payments received for that year. In dollars, each made over $500,000 in that year alone from Medicare payments.
Medicare Physicians Should be Held Accountable
It is unknown how much fraud took place in 2012, and the public will only find out if these physicians are audited, and regulations are put in place to hold Medicare-accepting physicians accountable. Releasing a report warning about the potentials of fraud is not enough to curtail healthcare practices that are taking advantage of the system and taxpayer money.
Physicians operating without ethical standards may think that Medicare fraud is a lucrative business, with over 50 million beneficiaries enrolled in this massive government program. The public release of the Medicare payment data may change that, creating more transparency on how much money physicians are actually earning from Medicare payments.
Perhaps it will encourage them to act more ethically, under the watchful eye of the public.
Carreyrou, John. “Judge Ends 33-Year Injunction That Shielded Medicare Data on Doctors” WSJ.com.
Luhby, Tami. “Doctors collect $77 billion from Medicare” CNN Money. 04-09-2014.
“Medicare Provider Utilization and Payment Data: Physician and Other Supplier” CMS.gov.