Today’s Managing Health Care Costs Indicator is 1979
It was 32 years ago that a federal court ruled that Medicare could not publicly release the payments to individual providers. The American Medical Association http://www.ama-assn.org/amednews/2011/04/04/gvl10404.htm fought hard against transparency of Medicare payments, and has aggressively defended this decision in court, in the legislature, and in public opinion.
However, a recent Wall Street Journal expose using the Medicare 5% claims file has shown how private parties can “mine” the Medicare data to ferret out potential fraud. Legislation to overturn this ban was recently filed by Ron Wyden (D-OR) and Charles Grassley (R-IA).
Medicare providers, including me, are federal contractors. Medicare represents 20% of total health care spending and about 23% of total federal spending now, and this will increase as the baby boomers age in to Medicare. It’s no longer reasonable to maintain the cloak of secrecy around provider payment. We seek sunshine in federal procurement –and expect to learn how much military contractors are being paid for toilet seats. It makes sense for physician and hospital Medicare payments to be a matter of public record.
My take on arguments against this transparency:
- Patient privacy might be inadvertently compromised. It could be easy to “break” the scrambling of patient identifiers, especially as large bills were disclosed that included claims for unusual illnesses. We should seek physician-level disclosure first, and add disclosure of deidentified patient-level data only once we are certain that patient confidentiality can be maintained. HIPAA provides robust protection against disclosure of data that can be tracked to individual patients.
- Providers might raise their prices when they see how much others are being paid for similar work. Medicare has uniform fee schedules for most physician and hospital procedures. Hospitals invest heavily in legislative and lobbying efforts to enhance fees, and I don’t see why this would increase if the rates were transparent
- Activists could use claims payment data to target specific physicians. For instance, Senator Rand Paul caught some flak in last year’s campaign for opposing government programs while accepting Medicare payment for his ophthalmology practice. I think this is a concern – which is likely shared by the record number of physicians in the current Congress, Transparency in fee schedules could “shame” physicians into being more discrete in their billing practices, which would be a social benefit.
- Marketers could use this information to target physicians for promotional efforts. Again, this is probably a reasonable concern. However, information about physician economic status is readily available to marketers already, so consumer marketing isn’t likely to increase. This information could help tailor the marketing efforts of those selling ancillary medical services (like implantable durable medical equipment.) These manufacturers already have a clear idea of high utilizing physicians.
We underfund the administrative function of Medicare, and as a result it’s hard to police against fraud and abuse. Full transparency in claims payment to providers can help “crowdsource” anti-fraud efforts, and thus ultimately lower health care costs.