Data uncover nation’s top Medicare billers
April 8, 2014 - Washington Post
The Medicare program is the source of a small
fortune for many U.S. doctors, according to a trove of government records that
reveal unprecedented details about physician billing practices nationwide.
The government insurance program for older people paid nearly 4,000
physicians in excess of $1 million each in 2012, according to the new data.
Those figures do not include what the doctors billed private insurance
firms.
The release of the information gives the public access for the first time to
the billing practices of individual doctors nationwide. Consumer groups and news
outlets have pressured Medicare to release the data for years. And in doing so
Wednesday, Medicare officials said they hope the data will expose fraud, inform
consumers and lead to improvements in care.
The American Medical Association and other physician groups have resisted the
data release, arguing that the information violates doctor privacy and that the
public may misconstrue details about individual doctors.
Among the highest billers were a cardiologist in Ocala, Fla., who took in
$18.1 million, mainly putting in stents. A New Jersey pathologist who
received $12.6 million performing tissue exams and other tests. And a
Michigan vascular surgeon who got $10.1 million.
Some of the highest billing totals may simply reflect a physician who is
extremely efficient or who has an unusually large number of Medicare
patients.
The highest numbers also may reflect a physician who specializes in
procedures that require costly overhead, and in those cases, a large portion of
the money may wind up not with the doctor but with pharmaceutical companies or
makers of medical devices.
But in some instances, the extremely high billing totals could signal
fraudulent doctor behavior, as government inspectors have previously found.
Indeed, three of the top 10 earners already had drawn scrutiny from the
federal government, and one of them is awaiting trial on federal fraud
charges.
The greatest tallies also may signal that the Medicare payments for some
procedures are too high for the amount of work involved or that perverse
incentives lead doctors to overuse a procedure.
The specialties most common at the top ranks of the Medicare payments were
ophthalmologists, oncologists and pathologists.
This information gives the public “unprecedented access to information about
the number and type of health-care services” doctors provided during the year,
Jonathan Blum, principal deputy administrator of the Centers for Medicare and
Medicaid Services, said in a blog post.
The Medicare program is the nation’s largest medical insurer. By virtue of
its breadth, the forthcoming billing data are expected to shed light on an array
of questions that have arisen about health-care costs as the nation has
confronted decades of rising medical bills.
Overall, the data cover $77 billion in billing involving 880,000
practitioners in 2012.
The AMA has warned that the data could contain errors, and in some cases, one
doctor’s billing number may have been used by multiple support personnel for
billing purposes.
In addition, the billing figures reflect what a doctor receives in payment
but does not show the actual profit after paying for equipment, support
personnel and malpractice insurance. For some procedures, the overhead can reach
three-quarters or more of the payment amount.
Many of the highest billers, for example, were in fields with unusually high
expenses, and that was likely to limit their personal share of the money. Using
the assumptions that Medicare and the AMA make when setting payment rates, only
23 of the 4,000 biggest billers personally earned $1 million or more,
according to a Washington Post analysis.
“The AMA is concerned that CMS’ broad approach to releasing physician payment
data will mislead the public into making inappropriate and potentially harmful
treatment decisions and will result in unwarranted bias against physicians that
can destroy careers,” Ardis Dee Hoven, president of the AMA, said in a
statement. “We have witnessed these inaccuracies in the past.”
But consumer and public interest groups argued that the information will help
consumers make better decisions.
“This data is important because it will make it possible for consumers to
identify physicians that will best meet their needs,” said Robert Krughoff,
president of Consumers’ Checkbook, a group that began seeking the release of
this information in 2005 and eventually sued for it.
For example, it will allow consumers to know which doctors are most
experienced in a given operation. Studies have shown that in several types of
surgery, volume matters: Surgeries by doctors who have performed the procedure
enough times are less likely to end with the patient’s death.
As for the potential that the data might misrepresent a physician’s practice,
Krughoff said, “The consumer organizations that have pushed for release of this
information have a strong obligation to make sure that the information is used
properly. But I believe in the marketplace of ideas.”
Opting for expensive
The doctor at the top of the list of largest Medicare billers is Salomon
Melgen, an ophthalmologist in West Palm Beach, Fla., who took in
$20 million from Medicare in 2012, according to the data released
Wednesday.
Most of Melgen’s take — about $11.8 million of it — came from injecting
patients’ eyes with Lucentis, a drug used for macular degeneration, according to
the data.
For each shot, Medicare and the patient pay a doctor about $2,000, but the
drug is very expensive and the doctor must then pay most of that money to the
drug’s manufacturer, Genentech.
What may be most interesting about Melgen’s practice, however, is that
he could have used a much cheaper drug than Lucentis — one called Avastin that
many ophthalmologists consider an equivalent.
Had he used the cheaper alternative, his bill to Medicare for the shots would
have dropped from $11.8 million to less than $500,000.
But physicians have a financial incentive to use more expensive drugs.
Medicare pays a doctor more for injecting the more expensive drug — the
physician’s fee is based on the drug’s price — and Genentech offered doctors its
own incentive to use the expensive drug: The company gave discounts to those who
use high volumes.
Melgen’s name appeared in headlines in 2012 as result of his connection to
Sen. Robert Menendez (D-N.J.), a friend who received campaign contributions from
the ophthalmologist. Menendez has been accused of improperly raising concerns
with federal health officials on his behalf.
Melgen’s attorney issued a statement before the data release to try to put
his client’s billing in perspective.
“At all times, Dr. Melgen billed in conformity with Medicare rules,” Kirk
Ogrosky said. “While the amounts in the CMS data release appear large, the vast
majority reflects the cost of drugs. . . . Responsible
analysis requires looking beyond the raw data to what was paid for
pharmaceuticals and expenses.”
The use of the more expensive eye drug helps explain why so many of
Medicare’s top billers are ophthalmologists.
Of the doctors who were paid at least $1 million by Medicare in 2012,
879 were ophthalmologists, who — like Melgen — relied on using the more
expensive drug, Lucentis.
Some physicians have suggested that using Lucentis is wasteful because a much
cheaper alternative exists.
“There is no advantage of using Lucentis over Avastin — as six randomized
clinical trials have shown they’re equivalent,” said Philip Rosenfeld, a Miami
ophthalmologist who has pioneered the use of the less-expensive drug.
Top billers
Melgen, like some other doctors among the top billers, already has drawn
scrutiny from Medicare investigators.
Indeed, government inspectors have noted that instances of billing disputes
and potential fraud may occur more frequently among the highest Medicare
billers.
A December report from the Department of Health and Human Services, for
example, analyzed the records of 303 physicians who were paid more than
$3 million by Medicare in a year. It found that 13 were responsible for
overpayments totaling $34 million, six faced payment reviews, three had
their licenses suspended and two were indicted.
In releasing the data, Medicare officials forbade news outlets to share any
of the data until 12:01 a.m. Wednesday. This provision meant that reporters
could not solicit responses from any doctors beforehand.
Because of that restriction on reporting, this article names only physicians
who previously have come under scrutiny and have had an opportunity to respond
to questions about their billing.
The second-highest biller in 2012 was Asad U. Qamar, a cardiologist in Ocala.
Qamar made headlines last year after a Reuters report detailed large donations
the doctor had made to the Obama administration’s agenda and a detailed federal
review of his billing practices.
He told Reuters that he had seen “tremendous harassment of the physician
community.”
The seventh-highest biller is Farid Fata, a cancer doctor in the Detroit
area. He received $10 million in Medicare payments in 2012. Fata was
arrested in August and is awaiting trial in a Medicare fraud case, accused of
intentionally misdiagnosing illnesses and ordering unnecessary treatments,
including chemotherapy for patients who did not have cancer.
Federal authorities say that Fata, who owned and operated two health-care
companies, fraudulently billed Medicare from August 2007 to July 2013. He also
is accused of conspiracy to pay and receive kickbacks to providers of home
health services and hospice services in return for referring patients.
He has denied any wrongdoing.
Not all of the highest billers have faced such scrutiny, however. The
fourth-highest biller on the list is a department chairman at the Mayo Clinic in
Rochester, Minn.
Answering questions
The data release is expected to answer a much broader array of questions than
who billed the most.
One of the persistent mysteries of U.S. health care, for example, is why some
surgeries are performed much more frequently in some areas of the country than
in others, as researchers at Dartmouth College noted.
Why, for example, is the rate of bypass surgery more than five times as high
around Hattiesburg , Miss., and Slidell, La., as it is in Grand Junction, Colo.?
Why is the rate of heart-valve replacement in Paterson and Camden, N.J., more
than twice that of New Orleans and Albuquerque?
The data may allow researchers to take a closer look at individual doctors to
find answers.
Jonathan S. Skinner, a Dartmouth economist, acknowledged that some doctors
“may feel that their privacy has been compromised” with the dissemination of
their billing records.
But, he said, “as earlier reporting has shown, there are people who are
operating in the gray area of health care who are causing Medicare to spend
enormous amounts on health care that may be harmful to their patients.”
Amy Brittain, David S. Fallis, Carol D. Leonnig, Steven Rich and Lena H.
Sun contributed to this report.