Release of Medicare Physician Pay a Sign of the Times in Healthcare

April 11, 2014

The release of Medicare payments to physicians is just another step toward greater financial accountability for all physicians, no matter who reimburses your practice.

"There are three kinds of lies: lies, damn lies, and statistics."
- Mark Twain

In 2012, CMS made payments to physicians of more than $76 billion according to a recently published report. This report was broken down by specialty and indicated how much was received by particular specialties.

Now, here comes the firestorm! Every possible side in this debate will weigh in with their interpretation of the numbers. The information was released on April 9 and already there are news stories refuting and reinterpreting the data.

I am a pediatrician and do not participate in Medicare so I have no skin in this game. But as a physician and a Medicaid provider, I know that information concerning my practice is likely to come in the near future.

As Mark Twain seemed to intuitively understand, statistics do not always tell the whole story. We all know that medicine in the U.S. is a very large, cumbersome beast that threatens to devour us all. We all understand the need to reign in the escalating costs; however the exact method to do this depends on who is asked how to fix the situation. And it often turns into a "NIMBY" ("Not in My Back Yard") point of view and argument. Doctors blame poor reimbursement and risk of malpractice suits. Politicians blame the doctors and hospitals as well as the opposite political party. Patients blame all of the above. And in the middle of all the finger pointing, very little seems to get accomplished.

What can be learned from the Medicare data release? The total payments for 2012 are staggeringly huge. We as physicians should pay close attention to the distribution of payments and analyze for ourselves why such a large amount went to so few physicians. Are they really that good at their job or are they better than the rest of us at coding and billing? It is obvious that certain specialties have more costly procedures and higher risk. But is it fair to other Medicare providers that help patients just as much?

I’m sure that there are some ophthalmologists out there looking at the report and wondering just how they missed out on such high reimbursement like some of the top grossing physicians. On the other hand, should we cast blame on this particular specialty? Their office visits are very brief as these physicians rely on many extenders and, after all, eyes are really a small part of the body. They don’t take too long to attend to. And injections into the globe are extremely risky, so should be compensated appropriately.

This report is simply the beginning of financial accountability that we are all facing. In just nine months, our reimbursement will begin to be tied to our performance. As long as medicine continues being a consumer product, we will have to have more transparency in our charges and reimbursement, no matter how distasteful. The alternative is national healthcare run by the government, as it is in most of the rest of the world.

Don’t misunderstand me: All these new changes are making everything more difficult for me and for my pediatric practice. I worry about this new grading system; when we are judged, will my practice be found wanting and not up to defined standards? Will these standards change on a predictable regular basis or will we be blindsided by sudden unannounced adjustments? Will a few bad outcomes have small effects or large effects on reimbursement? After all, sometimes patients don’t do well, despite the best care.

When most of us chose medicine as a career, we fully embraced that the field would be constantly changing and evolving. New medical advances and treatments are remarkable and exciting which help us make patients’ lives better. I bet that most of us didn’t appreciate that this would ultimately also apply to how we were paid.