Dollars and sense

19th Century English art critic John Ruskin was quoted as saying, “A little thought and a little kindness are often worth more than a great deal of money.” When considering the great deal of money in the Medicare payment data released this week by the Centers for Medicare & Medicaid Services (CMS), a little thought will definitely go a long way in preventing a jump to inaccurate conclusions (and possibly prevent some unkindness that isn’t warranted).

After years of debate, CMS finally released Medicare payment data for approximately 880,000 physicians for 2012. It showed that physicians and other healthcare providers took in about $77 billion in payments that year.

Some of the broader strokes are interesting to consider. About 2 percent of the physicians were responsible for about one-quarter of the payments, and certain specialties like radiation oncology and ophthalmology had very high per-provider payments. Diagnostic radiology ranked seventh in total payments at $3.4 billion.

The exercise in transparency could also spur an interesting conversation about the cost of individual services, as a small number of big ticket items contributed to some of the highest payment totals.

But some publications geared toward the general public played up the totals racked up by individual physicians, which without context could lead the average person to assume doctors are pocketing the large sums. A headline in The Tennessean invites its readers to “See Nashville’s million-dollar Medicare doctors,” for example.

The reality is those figures don’t tell the whole story. Some physicians bill for an entire practice, and the number next to their name in the payment data doesn’t represent their individual financial stake. The numbers also don’t show the overhead costs, which varies greatly depending on the specialty. The Wall Street Journal noted that for radiation oncology’s high per-provider payments, only about 18 percent of those payments are for physician work, with the rest going to overhead.

Many news reports have done a good job of showing the complexity of this payment data and adding context. Some people, though, may still get the wrong impression from the numbers. Transparency can be a little messy at times. In the end, however, releasing the data was probably the right move and it will be interesting to follow along as more detailed, thoughtful analyses are conducted.

-Evan Godt
Editor- Health Imaging