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It's not perfect, but Medicare payment data a jumping-off point for fraud detection


For the second straight year, the Centers for Medicare & Medicaid Services (CMS) released Medicare payment information. For the second straight year, it drew the ire of many in the medical community.

Those that oppose the data tend to fall back on one reoccurring argument: That data lacks context.

In particular, the American Medical Association (AMA) has been perturbed by the release of these figures to the general public. Last year, AMA lamented that the data dump would "mislead the public into making inappropriate and potentially harmful treatment decisions" and could "destroy careers" of some physicians.

It's not clear how many careers have been destroyed, but it's readily apparent that consecutive years of data offer new perspective on the way in which physicians are reimbursed. Even AMA's statement this year, complete with a handy little guide for the media, wasn't as heavy on the doomsday semantics, pointing to a "key improvement" in separating drug payments from payments for physician services, but their displeasure wasn't any less evident.

"We remain concerned that the 2013 data still have significant shortcomings," AMA President Robert M. Wah, M.D., said. "Specifically, the data released today do not provide actionable information on the quality of care that patients and physicians can use to make any meaningful conclusions."

In some ways, the AMA's concerns are valid; the Medicare payment data does lack context, but that doesn't mean it's worthless, particularly from a fraud and abuse standpoint.

For example, last year's data revealed that Florida ophthalmologist Salomon Melgen, M.D., was the highest-paid physician in 2012, bringing in nearly $21 million from Medicare. Since then, Melgen's fall from grace has been well documented. He now faces two federal lawsuits, one for overbilling Medicare $105 million and another for allegedly paying off New Jersey Senator Robert Menendez (D-NJ) to intervene in a federal investigation against his billing practices. (He has pleaded not guilty in both cases.) According to this year's data, Melgen was still the third-highest paid physician in 2013, netting $14.4 million from Medicare.

The second highest-paid physician in 2013 was Asad Qamar, another Florida practitioner juggling fraud accusations. In January, the Department of Justice (DOJ) intervened in two whistleblower lawsuits against Qamar, alleging the cardiologist regularly billed for procedures and tests that were medically unnecessary and waived Medicare co-payments for patients. At $16 million, Qamar's 2013 Medicare payments were nearly three times that of the next highest paid cardiologist, Tak W. Kwan.

Kwan himself represents a new and interesting data set now that we can see patterns and trends for two straight years. Although he received just under $6 million from Medicare, his payments jumped 648 percent from 2012, when he didn't even break $1 million. An office manager a Kwan's clinic told the Wall Street Journal that the spike is likely due to a new outpatient catheterization clinic established in 2013. Of course, some health experts have said this kind of spike raises concerns about self-referrals for potentially unnecessary tests.

Michael S. Valachovic, an internal medicine provider, saw an even larger spike in his reimbursement numbers, jumping from $252,491 in 2012 to $4.8 million in 2013, a 1,800 percent increase. Perhaps even more intriguing, 93 percent of his 2013 reimbursement came from lab tests, up from 22.5 percent in 2012.

To be clear, a large spike in reimbursement doesn't constitute fraud or abuse. But it certainly makes it easier for organizations outside of CMS to identify statistical outliers and work inward from there.  

To the AMA's point, context is key, but that's not as elusive as the organization makes it seem. For example, the highest paid physician in 2013 was Anne Greist, a hematology/oncology specialist who brought in more than $28 million from Medicare in 2013. Plus, she has an explanation that passes the sniff test: She is co-founder of the nonprofit Indiana Hemophilia and Thrombosis Center, which is the of the only hemophilia center in the state of Indiana, according to WSJ. The center treats complex patients with high treatment costs involving expensive prescription drugs. Twenty-three percent ($6.3 million) of Greist's reimbursement went to drug costs.

Medicare reimbursement data is far from perfect, but that's OK. We already knew that CMS isn't very good at data management, but we can work with what we have. Releasing payment information into the public eye offers a new and valuable kind of scrutiny. As more organizations analyze this data, it will evolve into a more robust source, particularly for fraud prevention and detection purposes--as long as no one is too quick to grab the torches and pitchforks. 

There's no question payment data has its shortcomings, but that doesn't negate its potential. The whole picture might still be a little fuzzy right now, but it's setting the stage for years of potentially usefully data trends and analysis. - Evan (@HealthPayer)

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