I support this completely:
Sens. Ron Wyden (D-Ore.) and Chuck Grassley (R-Iowa) are collaborating on legislation to require the federal government to make public how much it pays doctors who participate in Medicare, a Senate staffer said.
Payments to doctors and other individual providers in the Medicare claims database has been off-limits to the public since the 1970s, when the Florida Medical Association and the American Medical Association sued to keep it secret. The issue has resurfaced in recent months after The Wall Street Journal and the Center for Public Integrity sued the Department of Health and Human Services to get the information.
Those pushing for access to the database believe it could reveal major fraud that costs taxpayers greatly.
Both senators brought up the issue during a Senate Finance Committee hearing on fraud Wednesday morning. They did not seem aware until then of each other’s interest, but a Senate staffer said they’ve since agreed to work together, and told their staffs to do the same.“I’m very hopeful that we can have a bipartisan bill on this because I think this could create a very substantial disincentive for some of these multi-million dollar rip-offs,” Wyden told reporters immediately after the hearing. “And I also believe that the disinfectant of getting this information out to a wider array of individuals and groups makes a lot of sense.”
The other thing this will expose is how many doctors own the cat scans and MRI machines in separate businesses and pull in hundreds of thousands of dollars a year referring their own patients to the machinery they own. There is a reason for Americans pay so much more for an MRI than those in other nations (I wish I could find the graph Ezra Klein had up after talking to a member of the insurance industry).
*** Update ***
I misread. I thought this would announce payment amounts. It appears it is just a rate table.
BR
Wait – how will the rate table expose that?
John Cole
@BR: You are right, I thought it was payments, it looks like just a rate table.
Brian S (formerly Incertus)
All about it. The more transparency, the better.
General Stuck
Grassley, and any other winger that signs on to this much needed legislation, will have their counter tops scanned with extreme prejudice. And then sent a bill. Why? because it sounds liberal and could help reign in
profit; health care costs, at the very moment the war of obamacare is nearing it’s zenith. Don’t ask me to explain it, because it doesn’t make sense.John
Heck, you want to see what Medicare pays for any specifc treatment code and what not go to their website. It is all there.
Ahasuerus
This could be good news for those people who do not have insurance and therefore get socked with the full retail price for medical care. At bill time, they can point to the Medicare rate table (which presumably is pretty closely tracked by private insurer rates) and offer to pay that “reasonable and customary” rate rather than the retail rate.
I get EOB (Explanation of Benefits) statements from my insurance and am continually amused by the disparity in what the providers bill and what my insurer pays. It’s typically 20%-25% for primary care stuff, and sometimes 10%-15% for (far more expensive) hospital-based procedure stuff.
Ash Can
The AMA can’t even bear to have a lousy rate table be public information? Wow.
BR
@John Cole:
Reading a bit more about it, I’m not entirely sure what it is they’re proposing to expose. Looks like it may be some hybrid thing – like a rate table with aggregate data about individual (maybe anonymized?) doctors.
The Ancient Randonneur (formerly known as The Grand Panjandrum)
Atwul Gawande’s great New Yorker piece from a couple years ago really gets into this very issue.
Violet
Americans have more access to MRIs too, though. In the UK it’s not as routine to get an MRI and the machines are not as available.
Ditto for things like the ultrasound machines used for the sonograms for pregnancies. I know a woman personally who was high risk in two categories: over 40 and pregnant with twins. She went to her local NHS doctor and they just had the very old ultrasound machine that couldn’t provide the kind of imaging preferred for a twin pregnancy. Her doctor suggested she “go private” so she could get the ultrasound that the doctor felt was medically recommended. My friend also noted that her NHS clinic had a sign up: “Please donate and help us buy a new ultrasound machine!” Of course “going private” means paying for it yourself, or your insurance pays all or part, if you carry additional health insurance.
No system is perfect. I’d much rather we spent less and got better results. If this is a start, then I’m all for it.
Zifnab
@BR:
I imagine it doesn’t make everything crystal clear. However, if the doctor is truly sloppy, he could be cashing the checks for the MRI himself.
Past that, it gives one more data point. I believe business ownership is public record. So you could find out which doctors own which businesses. And you could see if a given MRI is doing way more business (or maybe way less business) than it should for its area.
Ahasuerus
@John: I did not know that. Do you know of anything comparable for the private insurance market?
Later: I went to the CMS Site in an attempt to verify or gainsay my supposition that private rates track M/M rates. The interface requires more detailed knowledge of HCPCS codes than I possess. Rats. More research for another day.
MikeJ
I don’t think this is just a rate table. In a separate bill, they mention, “require Medicare claims and payment data to be available to the public by provider name for the first time, similar to other federal spending disclosed on http://www.USAspending.gov.”
Also the graf: “After their lawsuit, The Wall Street Journal and Center for Public Integrity agreed to receive a pared-down version of the database containing 5 percent of providers, which they were forbidden from identifying. Even with those restrictions, they were quickly able to identify patterns of likely fraud.”
I don’t think a rate table would help id fraud that way.
Eric U.
I don’t think the actual practice of medicine is going to reveal much in most cases. They have been discouraging doctors from referring to captive labs for quite some time. The place where the waste is is in things that we don’t usually think of as medicine. I’m sure there are some crooks, there was one guy that was caught around here recently billing his rates for office visits that were handled by a nurse.
The problem with this is it almost never exposes as much money as it wastes looking for waste. And it just encourages more doctors to refuse to take medicare patients.
Roger Moore
@Violet:
And how often are those procedures really necessary vs. how often they’re only being done to fluff up the bottom line? As long as we run medicine as a for profit business, there’s going to be a lot of procedures that fall into the second category.
Zifnab
@Violet:
I’ll take “Universally covered pre-natal care with meh ultrasound and extra insurance/expense for better care” over “Suck it, poor-y. Go ask the EMR for help.”
dr. bloor
This has to involve some sort of information about how much is being disbursed to specific parties. As others have said, there’s nothing secret about the rates themselves.
agrippa
Those two Senators may not be helping their friends. Some people may read what is there and connect the dots.
Punchy
WAIT. An R working with a D? For any reason whatseover, even if it’s necessary, non-partisan, and for the good of all Americans?
Grassley to be threatened with a teabagger primary in 3…2…1…
Zifnab
@Roger Moore:
I think a more pertinent question might be “Why are MRI machines so god damn expensive?” I can buy a hybrid car for $24k, but my doctor has to shell out six to seven figure for a glorified X-ray machine so he can turn around and charge me several grand for an Internal Polaroid.
There’s absolutely no incentive to drive down costs, because the taxpayer or the insurance company is always footing the bill.
Maybe we don’t need fewer MRIs. Maybe we just need cheaper MRIs.
BR
@Zifnab:
Doesn’t getting an MRI cost around a hundred bucks in Japan? (I vaguely remember reading that somewhere.) Much cheaper than here.
Mike Kay (True Grit)
how will the invisible hand remain invisible with such legislation.
PurpleGirl
@Roger Moore: In the case of something like lower back pain — i.e., a suspected herniated disc — having an MRI provides an actual picture of the damage and avoids a dangerous and quite painful dye-injected x-ray which isn’t as good an image.
Joel
I agree; the NIH discloses grant totals and state universities disclose faculty salaries. Why should doctors be treated differently?
dmbeaster
I acted as an attorney for an MRI clinic in a dispute with its accounts receivable financier, which meant I was examining in detail the accounts receivable for the clinic. The range of prices charged for the exact same procedure was astonishing. From the bottom line price charged to Medicare to the poor schmuck without insurance and who did not bargain the price, the range was literally 3 to 1. There were probably a dozen different price tiers – for the same procedure. It was all about what the market would bear.
People who pay with cash and bargain the price? – primo rates.
I tell people that medical service pricing is something like the prices charged by street vendors in Tijuana, Mexico.
catpal
you were thinking correctly when you asked the question about doctors, extra testing, doctor’s business investments.
I had to go the an Orthopedic Dr for a knee injury. X-ray clearly showed torn meniscus. Dr. recommended PT.
Then the Dr. would not write the referral to PT unless I had an MRI also, even though not really needed. I later learned that that Dr. was a part owner in a chain of Imaging Centers. How nice and Extra $$$$$ for that Dr.
Even when you tell Doctors that your crappy Insurance will not pay for Extra Tests, they sometimes refuse to treat you.
PurpleGirl
Ajax won’t let me edit my comment… even in another tab.
Zifnab: MRIs are not glorified x-ray machines. X-rays mainly image hard tissue like bone. They require very special dyes to image soft tissue like spinal discs. MRIs image soft tissue with remarkable clarity without dyes.
cathyx
@dmbeaster: Can you tell us what the actual prices were?
Ronzoni
@Ash Can:
The AMA is one UNION they don’t want to bust, and it has been the strongest and most effective and long-lasting unions in the country. What other union has the option of imposing professional birth control on the whole damned country to artificially limit the numbers of providers? After all, they do control the “limited” seats available in their professional medical schools, don’t they? Can electricians, plumbers, teachers, etc., do this? Hah! It is to laff and laff and laff.
Roger Moore
@Zifnab:
Because large spatial volume superconducting magnets are not cheap to build or operate. I have one in my lab (it’s for a mass spec, not a MRI, so it’s higher field and smaller volume) and it was well into six figures. The cost of the things is not something that was invented by medical device manufacturers to justify high costs.
The bigger question is why a million dollar machine costs thousands of dollars per use. Even if you assume it’s only used for a handful of procedures a day, that’s still going to be thousands of scans over the useful life of the machine, or a capital cost of hundreds of dollars a scan rather than thousands. If the machine is booked solid, the capital cost per scan would be far less. That’s why other countries can do a MRI for something like $150-200/scan. The question is why we can’t get prices like that here in the USA.
Ivan Ivanovich Renko
Slightly off-topic– I needed to fill a scrip (DAMNED cold sores) and have been using the local pharmacy because their cash-payment prices have been very good. I went to pick up this little tube of Denavir, cash price at 41.50. I have a $1000 deductible for medications (i love our insurance, i really do), so I handed over my insurance card to get credit for it.
Only to find out: 1) It’s not on their formulary, and 2) if I put it through my insurance I have to pay over $100 for it!
I do NOT get that– they fuckers wouldn’t even be paying for it or toward it, but if I invoke them I have to pay more??
Thoughtful Black Co-Citizen
There are two laws in the pipeline that will make using imaging equipment to get rich quick a lot less attractive. One kicked in this year, the other in 2012. In fact, if you’ve ever wanted to own an imaging center, now might be a good time to buy.
However, in defense of doctors there’s a lot of money to be made by convincing a doctor he MUST HAVE imaging equipment (or lab equipment) or he’ll be driven out of business and eaten by wolves.
Mental Lint
@Ronzoni: You made a bingo! Restricting the number of docs is a key driver of rising costs. I’m amazed this doesn’t get discussed more in the healthcare debate.
dr. bloor
@Ronzoni:
Without getting into how this oversimplifies the whole health care behemoth, I’m always interested in asking those who pose this argument how much they think a well-trained physician should make.
So let’s play: How much do you think the following docs should earn each year: A family practitioner; B. cardiologist; C. oncologist; D. general surgeon; and E. neurosurgeon?
Emily L. Hauser/ellaesther
All I got for this is that for some reason, Chuck Grassley is following me on Twitter.
I believe I may get a chance to save the world after all — 140 characters at a time.
Well, that, and: Yes I continue to believe in health care reform in all of its many iterations, and transparency as well. It would be nice if this were what John first thought it was.
Thoughtful Black Co-Citizen
No idea why I’m in moderation. Oh yeah.
WORDPRESS IS EVIL.
Omnes Omnibus
@Ronzoni: Actually, I think lawyers and doctors are members of something closer to guilds than unions. Except for the ones in unions; those are union and guild members.
Emily L. Hauser/ellaesther
@catpal: Your story did not add much to the happy of my day.
Sheesh. Did you switch doctors?
dmbeaster
@cathyx
This was several years ago – I recall the price range was from around $500 to $1500.
Zifnab
@Roger Moore:
Well, if every doctor can own his own machine and only needs to operate at 10% capacity to pay off the device while making a healthy profit, why not have 10 times as many machines at 10 times the cost?
Zifnab
@Thoughtful Black Co-Citizen:
More like WordOppress, amirite?
catpal
@Emily L. Hauser/ellaesther: Yes a happy ending story with a better doctor.
got rid of the “highly-recommended” orthopedic jerk. PT helped and I did not have to have surgery so it ended well.
Gin & Tonic
@dr. bloor: Without playing the game directly, I’m wondering why you separate, for instance, cardiologists from oncologists. What reason is there for assuming they should be paid at different rates? Their training costs are roughly equivalent, neither typically does surgery, etc. This is not like asking why an experienced steamfitter, say, should make more than a general construction laborer, but more like asking why a skilled steamfitter should be paid differently than a skilled gasfitter. IOW, I don’t see your distinction.
Joel
@Zifnab: MRIs are a bit more sophisticated than x-ray machines. They’re basically portable NMRs. Obviously the level of resolution is nowhere near that of NMRs used in basic science.. but still. They do actually cost a lot to own and operate, albeit nowhere near what patients are charged.
gene108
@Zifnab:
Part of the problem with medical equipment purchases is we have a competitive system of health care. Each hospital, radiology lab, etc. is competing to some extent with other entities for your business. The hospital with the best MRI machine has a selling point, which may lure patients away from another hospital.
There’s an incentive to keep investing in the latest technology, even though the features, which make it so advance may only be needed for a small percentage of patients.
Japan’s lower MRI costs, a discussion on NPR.
agrippa
There is not only a restricted supply of doctors, there are other factors at play.
This is close to a monopsony. One vendor; one customer.
And, patients are ill; and can be in a life or death situation. A sick patient is very unlikely to ‘comparison shop’. The delivery side, the vendor, is in a one up position.
I see no one who has an ability or interest to control cost.
Ash Can
@Thoughtful Black Co-Citizen: I suspect WP had a spell of constipation there. Aimai and I were sent to moderation for no apparent reason in another thread just a little while ago.
FYWP
Omnes Omnibus
@Ash Can: I am sure both of you deserved it and more. I know your type, the both of you.
daverave
While they’re at it, why don’t they look into non-profit hospital chains that don’t pay any taxes yet manage to have “revenue above expenses” (aka “profit”) of hundreds of millions of dollars per year, pay their CEO’s and other admins millions of dollars per year, and have socked away BILLIONS of dollars in their bank accounts?
/end rant
Mary G
When I had my first knee replacement, my ortho wanted me to have something called Procrit first. It’s a drug that pumps up the red blood cells; I needed it because I have anemia.
The pharmacy went nuts. I had to have two doses and my COPAY was $750 each. The insurance didn’t want to approve it without a zillion forms, etc. I imagine their share was around $1500 each; mostly they cover 70% of really expensive things, if they cover them at all.
They sent the ortho the book of forms to fill out and he called to ask me why. When I told him my copay was $750 each, he went ballistic, because HE wasn’t going to be reimbursed $750 for the whole surgery. An education for both of us.
We went with having blood transfusions after the surgery instead. Medicare covered 100% of those. Worked fine.
This is the kind of decision that more people need to be exposed to. I think he should have made quite a bit more for all the pre- and post-surgery visits, not to even mention the surgery itself. It took four hours. He ended up making maybe $110 an hour. A good hairdresser or plumber in LA makes more than that.
One of my favorite sites on this is The Happy Hospitalist, an internist who writes a lot about these issues. He hates Obamacare with a passion, just to warn you, but still can be very illuminating about the nuts and bolts of this stuff. His lead post right now is very technical, but if you scroll down you will find one called “Transferring a Patient to a VA is an Exercise in Futility and an Embarrassment to Our Country, which illustrates some of the bureaucratic crap that many opponents are afraid will even get worse under Obamacare. You should read his rants about cataract surgery, which will make you never want to have one.
Chrisd
Their longer answer is, when we get really, really sick, we want U.S. style specialty care, with all the attendant bells and whistles, but magically at NHS prices.
Their shorter answer is, they should definitely get paid less than our reasonably compensated U.S. attorneys.
dr. bloor
@Gin & Tonic:
Eh, you’re right, they’re redundant for the current issue. Still waiting for someone to play, though.
Omnes Omnibus
@Chrisd: Average pay for attorneys is probably lower than most might think.
Mary G
My long and boring story about my personal experience is in moderation, but here is my last paragraph in which I finally get around to adding something useful:
One of my favorite sites on this is The Happy Hospitalist, an internist who writes a lot about these issues. He hates Obamacare with a passion, just to warn you, but still can be very illuminating about the nuts and bolts of this stuff. His lead post right now is very technical, but if you scroll down you will find one called “Transferring a Patient to a VA is an Exercise in Futility and an Embarrassment to Our Country,” which illustrates some of the bureaucratic crap that many opponents are afraid will even get worse under Obamacare. You should read his rants about cataract surgery, which will make you never want to have one.
Ignore it if you have read #50.
Chrisd
@Omnes Omnibus: Ditto for the family practice and general internist docs, dontcha think?
Gin & Tonic
@dr. bloor: OK. I’ll take a stab. I’m not uncomfortable with an AGI in the $250k range for a board-certified specialist.
Gin & Tonic
@dr. bloor: OK, I’ll give it a shot. Second shot, actually, because I used a bad word. I’m not uncomfortable with an AGI in the $250k range for a board-certified speshulist.
dr. bloor
@Chrisd:
Family docs are 150-200K per year nationally. There are a jillion ADAs, legal aid attorneys, etc on the low end in the legal profession that would sacrifice an organ for that money.
Silver
@Ronzoni:
Accountants do the same thing. Lawyers used to, but they are by nature venal and shortsighted, and they pump out way too many lawyers these days.
Not unions, by the way. Professional organizations is the preferred nomenclature. Unions are for shitty little people.
liberal
@General Stuck:
Double fixt.
liberal
@Chrisd:
No, because US style specialty care involves shit-tons of overtreatment, some of it extremely deadly.
dr. bloor
@Gin & Tonic:
You might be paying too much.
Emily L. Hauser/ellaesther
@catpal: Yay! Ok, my day’s a smidge happier now.
Those kind of stories just really, really frost my gibblets, nowhutimean?
liberal
@The Ancient Randonneur (formerly known as The Grand Panjandrum) quoted:
In a nutshell, this is why not only insurance needs reform, but health care delivery itself: financial incentives for doctors are incorrectly aligned, and not amenable to fixing.
Chrisd
@dr. bloor: Then they should follow their dream and go to medical school.
Ash Can
@Omnes Omnibus: NUH-UH. We didn’t break that lamp and eat all those cookies.
Gin & Tonic
@dr. bloor: Seems like the same ballpark. I’ll assume that not all those 19,000 are board-certified. I’ll pay a premium for that, because I have second-hand knowledge of what it takes.
Omnes Omnibus
@Chrisd: Maybe their dream was law school and they aren’t bitching about their pay.
Chrisd
@liberal: No question about the overtreatment, but none of it is at the point of a gun. You want less or different care? It’s your body–go get it.
Roger Moore
@liberal:
I wonder about this, too. You hear about doctors practicing “defensive medicine”, where they prescribe every possible test to avoid possible liability. The thing is that doctors keep doing this even in places that have strict malpractice liability caps. I wonder how much of this “defensive medicine” is really an excuse to order unnecessary but highly profitable tests at the physicians’ own labs.
dr. bloor
@Gin & Tonic:
You’re being unreasonably reasonable about this. You were supposed to say that you wanted your brain tumor removed by a guy who makes $50K/year, so I could launch into a rant about what a moron you are.
Omnes Omnibus
@Chrisd: If a patient does not know what treatments are necessary, that patient is going rely on the doctor’s evaluation of the situation. After all, the doctor is the expert and wouldn’t recommend unnecessary treatment, right?
Omnes Omnibus
@Roger Moore: I think it can also be doctors wanting to make sure that they got it right.
liberal
@Chrisd:
It’s also my tax money when most of the population gets all this unnecessary care.
liberal
@Omnes Omnibus:
FTW. Apparently chrisd has never heard of information asymmetries.
liberal
@Omnes Omnibus:
Yeah, but there’s cost/benefit to all of this. Prudent ordering of tests is fine, but presumably “too many tests ordered” means “tests which don’t provide enough additional information to justify their expense.”
Chrisd
liberal
@Roger Moore:
Only thing I can think of besides blatant overcharging is the “arms race” where every provider organization has to have one/many/whatever to keep up with the competition.
liberal
@Chrisd:
Plumbers aren’t costing us an additional few points of GDP every year.
Omnes Omnibus
@liberal: Oh, I don’t disagree; I just don’t attribute all “over-treatment” to venality.
@Chrisd:
Losing a trial does not automatically equal botching a defense. Just saying.
Chrisd
@liberal: Seems to me you have two choices. You demand people pay for their own unnecessary care. Or you convince the elderly to forgo pointless expensive end-of-life treatments, because that’s where the Medicare waste is.
Good luck with that.
Omnes Omnibus
@Chrisd: Yeah, because that’s how all the Euro-Canadian countries do it.
Chrisd
Yeah, but sometimes it does. Some lawyers are useless.
Chrisd
@Omnes Omnibus: The running theme throughout all these Balloon Juice posts, regardless of topic, is how we are, unfortunately, frustratingly, not Canada or Europe.
Omnes Omnibus
@Chrisd: So are some doctors, exterminators, teachers, politicians, plumbers, exotic dancers, ostrich wranglers, etc.
Gin & Tonic
@dr. bloor: Sorry to disappoint.
Chrisd
@Omnes Omnibus: Exactly, and add simple honest human error, too. The stakes can be a lot higher in some medical situations, but the principle is the same whenever you contract with a professional.
Roger Moore
@Omnes Omnibus:
I won’t say that every case of doctors demanding every test is a result of malfeasance. I won’t even say that it’s most cases. But there’s an obvious conflict of interest when a physician is profiting from the tests he is ordering run. We as a society need to stop pretending that physicians are automatically able to manage that kind of conflict of interest and do something to regulate it. Physicians are already forbidden from running pharmacies; the same thing should apply to diagnostic facilities.
Shorter me: medical decisions shouldn’t be driven by the profit motive.
mikeyes
The vast majority of physicians are not sole proprieters who can profit by a scheme of testing until the pocketbook screams. Most are employees of hospitals or groups and are salaried. The only incentive to make money is to be efficient and to see as many patients as possible.
Most young physicians are deeply (read $150K or so) in debt and can’t afford to start a practice on their own. Neither can they hire the people needed to thread their way through all the red tape from the (on the average)50 or so insurance companies that they need to deal with (not to mention the red tape of compliance with state, local and federal requirements.) They would rather have an organization do it for them.
Doctors who are employed by organizations are usually paid the so-called “professional fee” which is part of the overall insurance fee negotiated by their respective employers from the insurance companies. This professional fee is usually 50% to 70% of the negotiated fee (which is only a percentage of the retail price) and in order to earn their pay they usually have to meet a 200% of professional fees equalling their pay just to break even. Referrals, lab fees, machine use, etc. does not count in most practices so the bottom line is that most physicians have to work very hard, 55-80 hours a week, in order to meet the goals imposed on them by the organizations. Physicians usually don’t have the time or the means to develop a plan of fraud.
On the other hand the vast majority of fraud is related to insurance scams by criminals, i.e. setting up false billing, engendering false records and keeping ahead of the investigations. The usual scam is to find a somewhat less than ethical physician, set up in a poorer area and recruit medicaid and medicare patients (often using cabbies to find them by paying a bounty) and then start billing. They offer free care to these patients. It usually takes about three years for someone to catch on or millions of dollars later. All the crooks do is to suddenly close shop with the money and disappear.
Another scam, the one the present governor of FL used, is to charge for everything and make sure that your hospital offers everything to the patient whether they need it or not. This requires a large hospital and a willing set of executives who are well paid. Gov. Scott is not a billionare for nothing.
Ronzoni
@Mental Lint:
Well, thankee, son. A Bingo is always nice. But the observation is not mine alone; the New Yorker sometime in the mid-sixties published a cover article on the issue. My problem is that NOTHING has changed, and I have had 2 MD’s in the fambly.
Ronzoni
@dr. bloor:
Both my great uncles, Drs. Sam and Louis Sciabetti, were well off for their times but even comparing yesterday’s dollars, they were by no means millionaires, and Dr.Sam was a highly-respected surgeon (google him). One thing they both recognized was the fact that the AMA, with its focus on economic matters (among other things, naturally), was essentially a UNION. The beauty of the thing was/is that the AMA was/is also MANAGEMENT. Still is. What could be better?