Medicare's Big Data Dump Is Just That - A Dump

Apr 15 2014, 6:35am CDT | by

Medicare's Big Data Dump Is Just That - A Dump
Photo Credit: Forbes Business

Based on the headlines, many might think that the sole purpose of the Medicare data (released last week) was a scavenger hunt for the “Medicare Millionaires.” There was certainly no shortage of headlines with that exact phrase.

For those so inclined, the Medicare PUF (Public Use Files) are available in two formats (here), but fair warning – the uncompressed tab delimited file containing more than 9 million records is about 1.7GB. The Excel format is divided alphabetically into 12 separate files, so that could be a little easier to work with.

The trouble, of course, is that data (any size) isn’t insight and in this case specifically, revenue isn’t profit. Large and frequent Medicare bills are often legitimate and often get processed for many providers through a single name or entity.

Also, while the data is accurate – it’s incomplete. It doesn’t include payments through private insurers, Medicaid or other passive sources of income (ie: surgical or diagnostic imaging centers), and it doesn’t include the most important element of all for true insight – quality. Using a consumer brand analogy, procedure pricing alone is like two 4-door sedans priced $20,000 apart – with no other information. Brilliant.

What it definitely does do is provide the same shock and awe we’ve seen before with Steven Brill (Bitter Pill) and Elisabeth Rosenthal’s entire series on pricing (starting here) at the New York Times. I went as far as to call pricing transparency the healthcare “Story Of The Year For 2013″ (here).

It definitely manages to capture the imagination around a hopeful (and potentially large) impact on pricing. So let’s see the shock and awe.

  • 880,000 providers were paid about $77 billion by Medicare in 2012
  • Total charges for 2012: $252 billion. Total paid-out: $77 billion (roughly 31%)
  • Highest 2% of physicians represented 24% of total Medicare payment (over $18 billion)
  • Largest specialty by payment – Ophthalmology (17,000)
  • Almost 4,000 medical providers were paid $1 million or more (the “Medicare Millionaires”)
  • About 7 medical providers were paid $10 million or more
  • 1 Opthamologist in Florida (already under FBI investigation) was paid over $20 million (for about 900 patients)
  • 1 Cardiologist in Florida was also paid over $20 million
  • 1 Oncologist in Michigan was paid over $10 million (indicted for fraud)
  • 1 Anesthesiologist in Rhode Island was paid over $3 million (also indicted for fraud)
  • 100 Doctors received a total of $610 million
  • A common eye disorder in the elderly was the largest single reimbursement procedure – about $1 billion for 143,000 patients
  • There’s a significant gender imbalance among the highest paid – of the Top 10,000 billers – less than 11% were women

The list goes on. But what’s the value of this to any of us as patients – or to the much larger national need for healthcare reform? Not much.

The hope, of course, is that pricing transparency alone will unleash market forces which will fuel heated competition which will force lower prices. But hope isn’t a strategy when the system is running at over $3 trillion a year – and growing at about 5% per year for as far as the eye can see.

The most impressive patient service I’ve seen so far is the Wall Street Journal’s online search tool which returns the number of procedures performed (and billed to Medicare – paywalled here). That has some potential value for patients who can now compare the number of procedures performed (and billed to Medicare) in the broader assessment of a provider’s skill. Unfortunately, without information around outcome, it too is very shallow on real insight.

null  If transparency can accelerate the debate (and reform) around actual pricing – it does have broader value. In the meantime, 9 or even 90 million records alone isn’t very insightful.

Transparency will help – in fact it’s a prerequisite – but transparency is not going to be enough.” Steven Brill – Keynote Presentation – The National Summit on Health Care Price, Cost and Quality Transparency

 
 

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