WASHINGTON — Reimbursements to doctors who provide Medicare services in 2012 ranged from nearly $21 million to a single Florida ophthalmologist to the $27,000 for the average anesthesiologist, according to the first look at government payment data in 35 years.
The data were released this week by the Center for Medicare Services after a court order lifted an injunction sought by the American Medical Association had been in place since 1979.
It reveals wide variances in reimbursements, procedure costs and what services are provided to Medicare beneficiaries.
Releasing the data could help consumers understand health costs, help providers deliver better care and enable journalists and advocacy groups to sniff out fraud, experts say.
The three specialties with the highest rates of reimbursement were public health welfare agencies at 94%, mass immunization specialists at 92% and slide preparation facilities at 91%. Anesthesiologists and their assistants ranked at the bottom of the reimbursement pile with rates of 15% and 13%, respectively.
The data were released to enhance transparency, said Niall Brennan, acting director of the Center for Medicare Services Office of Enterprise Management, adding that he would not speak to specific cases. The beauty of it, he said, would be in seeing what outside users are able to discover through the data.
The data show in 2012 there were more than 880,000 providers, $252.4 billion in charges and $77.4 billion in payments. The statistics reveal that seven doctors received more than $10 million in payments, and that three Florida ophthalmologists each tried to bill at least $22 million.
One of those ophthalmologists, Salomon Melgen, took in more than $20 million from Medicare in 2012. Last year, Melgen's offices were raided by the FBI and Department of Health and Human Services. Melgen said he had done nothing wrong. The terms of the data release by CMS prevented USA TODAY from contacting Melgen in advance of this story.
Health officials have debated releasing the data for decades, said Gail Wilensky, former Medicaid program director under President George H.W. Bush. Opponents of releasing the information said people may not understand how to use it. In the 1990s, she said, hospitals made the same argument when required to release mortality rates.
"A lot of the same issues were raised; people wouldn't understand," Wilensky said. "That's always the first line of argument to data being released."
Transparency outweighs potential damage, she said, adding there should be a fast way for providers to correct errors.
"Making information public has a way of improving the accuracy and validity of information," Wilensky said. "Now there are a lot of parties interested in it being correct."
The data show the providers' names, addresses, specialties, billing rates, the amount paid by Medicare, number of Medicare beneficiaries and number of services provided for every Medicare provider.
Each provider lists a billing rate per service, and then what Medicare actually paid.
This can help consumers to see what they might pay for care without insurance or before their deductible is reached, but billing rates are like the sticker price on a new car, said Jason Caron, a partner with the law firm McDermott Will & Emery.
Each provider has a set amount for a procedure, but he or she negotiates with an insurer, a private payer or the government to come up with a final cost. Medicare also bases its payment on a complicated formula that has absolutely nothing to do with what a provider bills, Caron said.
Add to that the question of managed-care providers vs. fee-for-service providers and Medicare Advantage providers, and it makes sense that the rates will vary considerably, Caron said.
Wilensky agreed, calling the formula "byzantine."
In Florida, where providers are often paid by Medicare a sum closer to the amount they bill providers may only work with the government, which makes them more knowledgeable about what they will be paid, Caron said.
Still, he said, the data could show which providers are overvalued, and which providers are undervalued. The data include repayment rates for various specialties, which can vary widely based on how much "work" is included: If it's a surgery, are there technicians involved? Does a specialist do more "work" than a nurse practitioner? Does a speech pathologist require the same technology as a radiologist? Does a physician assistant require the same training as a cardiologist?
It could also help people advance their own agendas for payment, politics and fraud-abating, but should not be used without a full understanding of how the data work, Caron said.
"Could someone be doing something inappropriately?" Caron said "Well, there are bad apples out there."
But, some doctors may be paid more because they specialize in complex care or because they have a greater number of sick patients, he said.
"It's not going to surprise me at all to see people immediately drawing conclusions — something must be inappropriate," Caron said. "The question's going to be when you really get into the facts behind the data, what really plays out?"
Last year, the inspector general recommended that all providers who bill over a certain cumulative threshold have their claims reviewed. CMS is working on establishing that threshold and fraud prosecutions have reached record numbers over the past couple of years. But this could be a tool for outsiders to look for trends that computers miss.
"Deterring improper payments is a top priority of CMS in order to protect beneficiaries and taxpayers," said CMS spokesman Aaron Albright. "CMS is working with our contractors to develop an appropriate cumulative payment threshold that considers costs, as well as potential benefits in determining which claims and providers should be selected for further scrutiny."
New access, Wilensky said, could lead to better fraud prevention. Providers often have extraordinary volumes of procedures and testing, she said.
"The media have reported unusual, impossible amounts billed, and you wonder why it took the media to raise this to (the government's) attention," she said. "Credit card companies seem to do it in a real-time basis."
But perhaps more important, Wilensky said, the data could be used by the consumers themselves.
"This will be part and parcel of what we're trying to do in this country of getting more consumer involvement," she said. "An employer group can look at outcome data. They have big samples. And they can look at other physician groups with similar populations."
Debra Ness, president of the National Partnership for Women and Families, said she sees the data as good news for consumers.
"I think this is very exciting and it has been a long time coming," Ness said. "I think it's part of a much larger cultural change in health care."
The data could help people understand pricing, and she hopes to see it packaged in a way that helps consumers. The numbers could help providers understand what services they offer that differ from what other providers offer. Also, even though the data do not include outcomes, Ness said, experts could see whether unnecessary care has added to costs while necessary care has been overlooked.
"I think shining the light of transparency helps everyone become more accountable and more conscious of what they're doing," Ness said. "I think there are a lot of times people think they're doing the right thing, but until they step back and see the data and compare to others, they may not realize they are consistent with best practices or their peers."