Story URL: http://news.medill.northwestern.edu/chicago/news.aspx?id=229902
Story Retrieval Date: 11/1/2014 5:32:00 AM CST

Top Stories
Features
STAMP_PHOTO

Creative Commons/Aaron Fulkerson

Medicare's $3.4 billion payout to Illinois healthcare providers in 2012 is a large sum, but may say little about trends in healthcare costs.


Medicare's $3.4B payout to Illinois providers says little about cost trends

by Osahon Okundaye
April 17, 2014


More than half of Medicare’s $3.4 billion insurance reimbursements to Illinois health care providers in 2012 went to just a handful of medical practice areas, according to data released by the Obama administration last week.

Almost $1.9 billion of the total reimbursements in the state went to 10 of the 81 officially designated practice areas. Internal medicine topped the list, where Medicare spent $460 million.

More than half of Medicare’s $3.4 billion insurance reimbursements to Illinois health care providers in 2012 went to just a handful of medical practice areas, according to data released by the Obama administration last week.

Almost $1.9 billion of the total reimbursements in the state went to 10 of the 81 officially designated practice areas. Internal medicine topped the list, where Medicare spent $460 million.

Ophthalmology was the no. 2 compensated practice area in Illinois with $249 million, followed by ambulance services at $217 million.

DePaul University public health professor Grace Budrys said the payments reflect Illinois’s needs.

“We’re not dealing with acute illness any more,” she said. “It has to do with the aging population. Internists are dealing with chronic illness and the fact that they see patients over and over.”

“Internal medicine is where the action is,” Budrys said.

While the Medicare data released by the Centers for Medicare & Medicaid Studies gave a glimpse into how doctors are compensated, it didn’t show what patients got for that money. The massive data disclosure is fairly granular, listing how many times a doctor performed a procedure at a particular clinic, for example. It doesn’t, however, show how effective individual treatments were.

Dr. Robert Centor, chairman of the board at the American College of Physicians, said watchdogs can only scrutinize doctors so much.

"The naive believe that we can measure physician quality. We cannot. Quality has too many legitimate dimensions. Not all those dimensions are measurable,” he wrote in a blog post earlier this month.

Budrys disagreed. Cost can be one general measure of a doctor’s effectiveness, she said.

"We have too many doctors, too many specialists,” she said. They run batteries of tests, which run up patients’ tabs and inflate doctor pay.

Controls over doctor pay are poor, Budrys said, encouraging them to run the same tests multiple times. Her solution is to reduce the number of specialists and increase responsibility for general practitioners by reorganizing medical school training programs.

“Reducing doctors will reduce costs, and will not reduce quality of care,” Budrys said.

Individual physicians weren’t the only ones with big Medicare reimbursements. Medical test provider Quest Diagnostics LLC was the biggest organizational recipient, totaling nearly $34 million, according to the same data set.

Ambulance services took in large sums, too. Superior Air-Ground Ambulance Service Inc. received $28.9 million. Lifewatch Services Inc. took in $23.9 million and the City of Chicago got just under $15 million.

With only 2012 data to analyze, it’s hard to make any real sense of the payment data. Northwestern University health economist Burton Weisbrod said there isn’t enough information over time to extrapolate trends or pinpoint potential waste in Medicare spending.

“I simply don’t know what these numbers mean,” he said, frustrated with the lack of context.

“Frankly, I’m just bewildered by them.”

Weisbrod said it’s hard to interpret the $3.4 billion of reimbursements in the state because all it really shows is the total quantity of services provided, which says little when comparing practice areas.

Without more contextual data, he went on, it’s impossible to know if too many people are seeing internists or using ambulances, or what “too many” even means.

“I just do not see what the Medicare authorities thought they were contributing when they were putting out these numbers,” Weisbrod said.

The only thing this information does, he added, is provide fodder for top-earners lists.

 

 “The public seems to be enamored of lists.”