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April 9, 2014

Medicare reveals how much it pays each doctor. Here's what the data show

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CMS on Wednesday publicly released Medicare physician payment data for the first time since 1979, showing how the program paid out $77 billion to more than 880,000 health care providers in 2012.

What the new data include

The data released Wednesday include information on payments made under Medicare Part B in 2012 to all participating providers. Specifically, the data include:

  • Physicians' names and addresses;
  • Summaries of the services provided; and
  • The amount providers were paid for the services.

The data do not include any patient information. Further, CMS will not release any information on providers with fewer than 11 patients who are Medicare beneficiaries. 

How making physician data public could affect practices

Data analysis: Small portion of doctors receive large sums

Altogether, the released data show that Medicare paid $12 billion for about 214 million office and outpatient visits in 2012. Most providers received relatively modest Medicare payouts, according to the Los Angeles Times.

However, about 2% of physicians and other individual providers accounted for almost one-quarter of the $77 billion total. And about one-quarter of providers participating in Medicare receive about three-quarters of the total payments, according to the data.

Specialists tended to receive higher reimbursements. For example, about 3,300 ophthalmologists were paid about $3.3 billion under the program, as reimbursement for a frequent but expensive treatment for age-related macular degeneration. Meanwhile, fewer than 1,000 radiation oncologists accounted for reimbursement payments of more than $1.1 billion.

Some individual physicians received particularly high sums. For example, 100 physicians in 2012 accounted for $610 million in reimbursements, including an ophthalmologist who was paid $21 million under the program and several dozen eye and cancer specialists who each received more than $4 million.

'Unprecedented' level of transparency

According to the New York Times, the data "provides an unprecedented look" at the U.S. health care system and shines "fresh light" on day-to-day treatment decisions. Further, the information will give consumers the ability to compare providers and treatments in a manner never before available.

Marty Makary, a cancer surgeon at Johns Hopkins School of Medicine and the author of a book that argues for making data on doctors and hospitals more publicly available, said, "While the data are not perfect, this is a major milestone in health care transparency."

Officials, advocates warn against misinterpreting data

According to the Los Angeles Times, many stakeholders cautioned the public against misinterpreting the data.

For example, federal officials say that the high payouts do not necessarily indicate instances of fraud or over-billing, as payments could have been boosted by physicians treating particularly ill populations or because they have tailored their practices to treat Medicare beneficiaries. In addition, other experts note that an individual doctor might seem to have been paid for an unusually high number of services because he or she oversees medical residents or physician assistants, while billing for the services him or herself.

Ardis Dee Hoven, president of the American Medical Association, says, "We know there are going to be limitations" because it is "raw claims data." Hoven adds, "This gives us no window into quality or anything of that nature," such as whether patients benefitted from treatments or if the surgeries and medical services were necessary. In addition, Hoven argues that physicians should have been able to review the data, and that the information could contain flaws.

How the information will be used

Regulators, insurers, and other industry stakeholders are likely to use the information to better understand treatment patterns and locate potential sources of waste and fraud in the system, according to the New York Times.

For example, Paul Ginsburg, a health economist and professor at the University of Southern California, noted that insurers using the Medicare data in addition to their own information will "have a lot more to work with" in determining how physicians treat their patients, such as whether they order too many tests or if they are slow to operate.

"We're excited over this unprecedented release of physician data," said Paul Matsui, who oversees the Advisory Board's Data and Analytics Group. "And we're already planning a variety of analyses and assessments utilizing these data in the coming days, weeks, and months" (Terhune et al., Los Angeles Times, 4/8; Abelson/Cohen, New York Times, 4/9; Begley/Pell, Reuters, 4/9).

Not just doctor data: CMS data on hospital billing

Our Price Transparency Guide

As the number of high-deductible health care plans increase—and more patients consider cost when choosing providers—organizations need to get up to speed on price transparency. This guide outlines objectives for:

  • Maximizing your patient financial counseling department;
  • Preparing your department for the increased volume of patients asking about out-of-pocket medical costs and pricing for scheduled procedures;
  • Creating collateral that explains out-of-pocket financial responsibility for a medical service to patients; and
  • Developing online portals and third-party avenues to help create a culture of price transparency.


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