Wednesday, April 9, 2014

Medicare Physician Costs for 2012

Government is a poor manager. It is, of necessity, concerned with procedure, for it is also, of necessity, large and cumbersome. It must administer public funds and must account for every penny. It has no choice but to come ‘bureaucratic.” This means high costs, for ‘control’ of the last 10 percent of phenomoma always cost more than control of the first 90 percent.

Peter F. Drucker (1909-2005)

A tiny sliver of doctors and other medical providers accounted for an outsize portion of Medicare’s 2012 costs, according to an analysis of federal data that lays out details of physicians’ billings.

Christopher Weaver Tom McGinty, and Luise Radnofsky, “Small Slice of Doctors Accounts for Big Chunk of Medicare Costs, “ Wall Street Journal,  April 9, 2014

Here is the 2012 data:

Provider Type , # Providers, $ millions paid, average amount per provider
Hematology/oncology, 7,374, $2,703,9,  $366,677
Radiation oncology, 4,135,$1499,6, $362,366
Ophthalmology, 17,067, $5585.0,  $327,239
Medical oncology, 2613, $ 806,6, $308,702
Portable X-ray, 7, 2.0, $288,020
Rheumatology, 4053, $19044.5, $217,701
Nephrology, 7,503,  $1685.3, $224,657
Cardiology,  22,241, $4,965.3, #223,248
Dermatology, 10,507, #2235.3, $212, 745
Pain  management, 1856m $3661,$197,299
Peripheral vascular disease, 74, 14.3m $193,441
Hematology,  687m 127.6, $185, 757
Cardiac electroohysiology, 1117, $204.0m $182, 641
Vascular surgery, 2696, $485.3, $180,641
Urology,  8791, 1385.4m $157, 589

Source: CMS

What does this data tell us?

According to the Wall Street Journal,  it tells us:

·         1% of doctors accounted for 14% of $77 billion in Medicare billings.
·         344 doctors received more than $3 million each.
·         The 1000 highest paid doctors received $3.05 billion in payments.
·         One-third of top earning doctors are ophthalmologists, and one of ten is a radiation oncologist.

What is also tells us is:

·         Doctors who perform procedures receive the most Medicare money.
·         Cancer, heart disease, eye conditions, kidney disease, and various blood vessel  problems account for a lot of money care money, and imaging accounts for a lot of Medicare money spent.
·         Primary care physicians account for very little of Medicare money expended.

What the data doesn’t tell us:

·         The final income of doctors after expenses.
·         The cost of equipment for these specialties.
·         The cost of doing the procedures.
·         The context in which the earnings occur.
·         Whether the procedures perform improved outcomes
The data doesn’t really tell us anything we didn’t know already – that specialists consumer more Medicare data than generalists, that high tech care in the elderly cost money,   that  certain specialists earn more money than others, and that these figures represent fraud or abuse.      The data gives physicians’ names, and that is certain to be interpreted as an invasion of privacy. Furthermore, the data is short on details – patients’ diagnoses,  date of procedure,  costs of equipment required, cost of drugs needed.   The data has limited usefulness,  but is certain to be used in a search for fraud and abuse and to demonize high earning specialists.’

Tweet:  CMS has released data on what Medicare paid doctors in 2012,l and to no one’s surprise,  specialists performing procedures on common problems of the elderly made the most.


Ashok V. Daftary, MD, FACP. said...

Agree with most of your analyses. However, if one did a time study related to billings as I have done for several members of my community the. Day does not have enough hours to accommodate them......comments... These will be the forage for fraud investgators

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