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Medicare data raises fresh questions about concentrated payout for few doctors

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    An unprecedented release of data today is putting a new spotlight on what doctors are paid in the long-running battle over how to trim the nation's health care spending. The data, the first of its kind released by Medicare, offers a rare look at how $77 billion was paid by the government to 880,000 providers in 2012.

    Among the key findings, just 3 percent of doctors and medical providers received at least one-quarter of all those payments. News analyses also showed Medicare paid nearly 4,000 doctors and providers more than $1 million apiece that year. The release of the data has long been the subject of an argument among consumer groups, watchdogs and doctors' trade groups.

    We look closer now at what the initial analyses showed with Shannon Pettypiece. She reports for Bloomberg News. And Dr. Ardis Dee Hoven, she's the president of the American Medical Association, which had long opposed the release of this data.

    And we welcome you both to the program.

    Shannon Pettypiece, let me start with you. You have looked at all this. What do you think is the most important information here that is now available that wasn't before?

  • SHANNON PETTYPIECE, Bloomberg News:

    I think some of the things that are standing out the most to us is that there is a small number of doctors, as you mentioned, where a lot of this Medicare money is being concentrated. A lot of that money is going there.

    As you said, about 3 percent of doctors are getting almost a quarter of all the Medicare money that is paid to doctors. That was surprising and that was interesting to us, and I think now the idea is to sort of drill down into that data and find out why these doctors are getting so much. In some cases, there are likely going to be instances of waste, overuse, fraud.

    Some of the cases, there is going to be a perfectly good explanation why some doctors are getting paid some high amounts. But it raises a lot of questions that we haven't really been able to ask before but this is the first time we're really getting a look at this data.


    Shannon, staying with you, are — is there something that the doctors who got the most money have in common with one another?


    Well, there are a lot of ophthalmologists, a lot of eye doctors on this list, which is something that surprised us.

    Among the top 25 highest paid doctors, about half of them were ophthalmologists. And we looked into this a little bit and found out that that's actually being driven by some of these new, very expensive drugs that are now available to treat people with a condition of blindness called macular degeneration that's very common in the elderly.

    A lot of doctors are using these drugs, administering them in their offices, and that's where a significant amount of Medicare money is going, which I don't think many people realized, until now, when we were actually able to crunch these numbers.


    Up until now, Shannon, what was the general understanding of how Medicare was supposed to work?


    Well, the idea of how it is supposed — how it is supposed to work is that the doctors who are doing — treating the most seniors, who are providing quality services, that they're appropriately treating their patients, the seniors, the 50 million elderly and disabled who get this money.

    You know, what is — the concern has always been is that there is a lot of waste going on in the system, that there are doctors who are doing excessive procedures, excessive tests, and that's sort of what people are going to be now looking for in this data.


    And, finally, just right now, Shannon, remind us why this is being released today by the Medicare agency.


    Well, it's been kept from the public for about three decades, when a judge ruled that — put an injunction on this data, saying that doctors' privacy should be protected here and this data shouldn't be released.

    The Wall Street Journal sued to have this data released. And in May, a judge lifted that injunction. And the Obama administration said last week that they were going to release this data. And part of that, the Obama administration says, is this push towards more transparency in the health care system, being able to lift the veil on a lot of the payments and activity that goes on in this $600 billion-a-year Medicare program, and be able to let consumers, watchdog groups, members of Congress, patient advocates see this data, and hopefully use that to try and tease out some waste and find out what works and what doesn't in the system.


    All right, I will turn now to Dr. Ardis Dee Hoven.

    As we said, you are president of the American Medical Association.

    How do you explain what appears to be a lopsided system of payments here for Medicare?

  • DR. ARDIS DEE HOVEN, American Medical Association:

    It's very early, right now, I think, for us to really understand all the details involved. There are many elements to this that have to be reviewed and understood.

    It is very clear that our concerns have been around safeguards of this information. Is the data correct? Are we taking into consideration high-risk populations that need specific care, and obviously just releasing data doesn't address quality issues.

    So I think on the front end of this discussion, we have to be clear about the fact that we're not — we have to spend more time doing the deep dive into the data, what does it mean, who are the patients being served, and how they are being provided the care that they receive?


    Based on what you have seen, though, Dr. Hoven, is this the way the system, the Medicare system is supposed to work?


    Well, physicians need to be paid for providing high-quality care to their patients, and the patients deserve to get the high-quality care that they need.

    Clearly, we need to pay more attention to details. I think right now in terms of how this is working, raw data is not specifically the way to look at it, and I think one of the things you have to look at, as was already mentioned, is the cost of drugs built into these payments.

    Remember that physicians, particularly in ophthalmology practices, oncology practices, urological practices, have to purchase these drugs. And they have to pay a reasonable price for these drugs. And Medicare will only pay them for 80 percent. The patient pays 20 percent. And they, the physician's office, is responsible for the difference, if, in fact, the patient can't use the drug, it is wasted, responsible for storing it.

    Costs of providing the care are very important, and I think, as we review this data, as anyone reviews this data, they have to be very careful about how they interpret this information.


    Well, just — just on the surface of it, the fact that ophthalmologists were half of those who were the highest paid, what would be the explanation for that?


    My interpretation initially — again, I'm not an ophthalmologist, but would be in fact that these folks are taking care of people with significant retinal diseases, retinal degeneration diseases. These are difficult to manage and they are costly.


    And just in connection with that, Dr. Hoven, when people look at this and they look at the number of procedures, the cost of procedures, and people ask, well, because you pay more for something, does that mean it's a more valuable procedure, how do you answer that? How do you answer the quantity vs. quality question?


    High-cost care doesn't necessarily mean high-quality care. And I think we're all very aware of this in this day and age.


    Well, the other — the other question that comes to my mind is, why was the American Medical Association opposed to the release of this data for so long? Is there damage done by this release?


    To the first question, it is clear that we are very supportive of transparency in data release. We want it to be accurate.

    We want it to be usable in the appropriate way. We want some safeguards in place to make sure that that data is not simply out there in an uninterpretable way. And, unfortunately, I think that may be the case with the way CMS has presented this data. We are very concerned about quality, and we're very concerned about making sure that physician practices are able to do what they need to be able to do to take care of patients.


    Well, can the AMA and other organizations representing physicians now get additional information out there that you think will put this information in context?


    Yes, I think we can. Now that we have seen the format it's presented in — and, by the way, we didn't know what this information would look like.

    We received it at the same time everyone else did. Now that we have this information, I think it will enable us to continue our dialogue with CMS, with Medicare, to talk about the ways to improve the way the data is presented, to make it more user-appropriate and giving interpretation guidelines in an appropriate way as well.


    Well, seeing what you see right now, Dr. Hoven, do you still believe it is a mistake to release this to the public?


    I don't think it's a mistake to release it to the public.

    The important thing is, you want data to be released in a way that is usable and it's appropriate and that those safeguards are in place, so that it is not misused in the care of patients.


    Well, let me finally just come back to you, Shannon Pettypiece with Bloomberg News.

    For the ordinary folks out there watching this, if they want to look at this information, what's the best way to see it and understand it?


    Well, it is a bit complex to go through. It's available on the CMS Web site, the Center for Medicare and Medicaid Services. You can find it on their Web site.

    It is a big chunk of data. It crashed some of our computers around Bloomberg when we were trying to download it into an Excel spreadsheet. But if you do get on there, and you do get in there, you can go through and search for your doctor. And you can see things like how many of a certain procedure did my doctor perform, how much was my doctor paid, was he paid a lot more than his peers for Medicare?

    And people may have questions about whether their doctor has been doing too many of a certain procedure on them, and they can see how that compares to their peers. Does my doctor a lot more stents than other cardiologists, for example? So, that's a way that people can use this information.

    But, as Dr. Hoven was saying, it has to be all taken into context. And there can be very good explanations for why there is going to be an outlier here in this data, but it allows us to ask these questions, and patients can go in and ask their doctors, you know, I saw that you get a lot more money from Medicare than the average cardiologist or average ophthalmologist. Why is that?

    And they may have an explanation. They may not. But it allows people for the first time to see this information about doctors, which we really have — that has been a black box until this point.


    Well, the questions have begun.

    And we thank you both for joining us with some of the answers, Shannon Pettypiece with Bloomberg News, and Dr. Ardis Dee Hoven, president of the American Medical Association. Thank you.

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