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Data Going Awry - Limits of Medicare Billing Data - Figures Don't Capture Complexity of Some Medical Practices


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Doctor-Pay Trove Shows Limits of Medicare Billing DataFigures Don't Capture Complexity of Some Medical Practices

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The trove of Medicare data released Wednesday shows a wide cast of characters in the top ranks of the highest-reimbursed doctors, and reveals as much about the limits of the newly public billing records as it does about medical practice.

Among the highest-reimbursed doctors in their fields were a Michigan oncologist with $10 million in 2012 payments and a Rhode Island anesthesiologist at $3.5 million, both of whom have been indicted for fraud in federal courts. Also among the highest reimbursed was Jean Malouin, a family-medicine doctor in Michigan, but that is because she reimburses other doctors in a special demonstration program backed by the agency that oversees Medicare. The Michigan oncologist has pleaded not guilty. An attorney for the anesthesiologist says his client is innocent. 

That diversity underscores crucial gaps in the new data. Medical groups and policy makers have asserted that the figures lack context needed to show which doctors may be abusing the system and which are simply hard workers and overseers of complicated medical practices, or those whose specialties involve high overhead costs, such as radiation oncology, that lead to bigger bills.

The government disclosure spurred doctors on Wednesday to defend and explain their practices in detail usually obscured from public view. "This public release will create enormous social pressure to be cautious about being an outlier," said Peter J. Pronovost, senior vice president for patient safety and quality at Johns Hopkins Medicine in Baltimore. "No physician is going to want to be labeled as that person who is billing $20 million."

The disclosure of the data came after a lengthy legal battle by Dow Jones & Co., publisher of The Wall Street Journal, to overturn an injunction that had prevented the government from publicly releasing Medicare payment information on individual doctors. While the data set is the first to show what doctors are paid for specific procedures billed to Medicare, the federal health insurance for senior citizens, it lists nothing about specific patients, including their disease levels or whether treatments worked. The records don't follow doctors, or their patients, over time, and don't capture the intricacies of increasingly complicated medical practices that may house multiple providers in a wide variety of arrangements.

The figures also don't reflect differences in overhead costs for doctors. While radiation oncology produces among the largest per-doctor payments of any specialty, only about 18% of those payments represent physician work, a smaller share than in other specialties. The remainder was meant to cover the doctors' overhead.

Medicare fees for specific procedures are based on the physician's work, the expected overhead for equipment and other expenses, and the cost of malpractice insurance. The upshot, say even the proponents of the data's release, is that it may have limited utility for rooting out fraud or abuse, as it catches a wide range of doctors in the same net.

Jonathan Blum, principal deputy administrator for the Centers for Medicare and Medicaid Services, cautioned, "Folks should not jump to conclusions simply by seeing spikes in spending, but they help to find questions and to dig several levels deeper."

"We found that just exposing things changes behavior," said Sen. Charles Grassley (R., Iowa). Last year, he and Sen. Ron Wyden (D., Ore.) reintroduced legislation to make the whole Medicare claims database public.

The data indicate that the Michigan family medicine specialist, Dr. Malouin, billed for more than 200,000 patients and received more than $7 million in payments. But Dr. Malouin oversees a statewide, Medicare-funded project known as a "medical home" meant to incentivize doctors to better coordinate care. The payments largely represent bonuses paid to the participating doctors to defray their cost of after-hours care and other special services, she said.

"It's unfortunate that my name was associated with all these claims," Dr. Malouin said. Some physicians among the top billers also pointed to the complexity of their practices as a reason for seemingly high bills.

Jeffrey Fernyhough is the orthopedic surgeon with the second-highest 2012 Medicare payments for his specialty, while his partner in a Boca Raton, Fla., medical practice, Nathaniel Lowen, ranked third. They received a combined $4.39 million from Medicare.

But the doctors said in an interview that their bills include services by two physical therapists and four physical therapy assistants, who performed 11,768 therapy sessions billed at about $23 each, among other things, along with two physicians assistants. Under Medicare rules, some other providers bill services that are attributed to doctors.

Dr. Fernyhough also said the vast majority of his practice's patients are on Medicare, owing partly to Boca Raton's aging population, while many orthopedic surgeons elsewhere treat more younger customers with hip and knee injuries and thus may bill less to Medicare.

Klaus P. Rentrop, medical director of an imaging concern in New York City called Gramercy Cardiac Diagnostic Services, was listed as the ninth top recipient of Medicare payments for cardiology. The program paid him $2.73 million for 18,034 claims filed for 2,321 patients, the data show.

Doctor-Pay Trove Shows Limits of Medicare Billing Data - WSJ.com

Dr. Rentrop said he was "honored" by the placement. He said the PET imaging services he and his colleagues provide, while more expensive than other imaging tests, more accurately show the presence or absence of cardiovascular disease and as a result reduce the number of patients who are referred to hospitals for more expensive and invasive tests called cardiac catheterizations.

"We are large and we are growing because we are doing what should be done and what Medicare wants to be done," he said. "We are avoiding unnecessary and expensive procedures."

Irrespective of whether physicians supported the release of the data, there was intense interest in the subject in many medical practices, according to doctors.

"I right away looked at the ophthalmologists who got millions of dollars," said Kenneth Bromberg, chairman of pediatrics at the Brooklyn Hospital Center in New York, who doesn't bill Medicare.

Edward J. Schloss, medical director of cardiac electrophysiology at the Christ Hospital in Cincinnati, said he spent the morning on his computer furiously digging through the billing figures while alternating the sleuthing with his clinical work. He called searching the billing database "kind of like Googling yourself."

Dr. Schloss took to Twitter amid the frenzy: "search tool is burning away all of my time this AM. So many devils/details."

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