Those fears proved unfounded. Most media stories on the first or second day after the massive data dump prominently noted that reports for single providers might actually cover dozens or even hundreds of physicians. They also reported the Medicare payments had to cover office overhead, staff salaries, equipment and drugs and supplies. Payment dollars didn't translate into physician salaries or practice earnings.
Those caveats didn't stop two national media outlets—the New York Times and the Wall Street Journal—from immediately posting the data with a user-friendly interface on their websites. It enabled anyone desiring to look up their own physicians—or one they want to know more about or compare—to discover how many patients that doctor saw with the same condition, how many times they performed the procedure, how much they billed the CMS and how much they got paid.
How useful is that information? From a consumer or patient perspective, it would be nice to know how many times your doctor has performed a particular procedure. Experience matters.
But beyond that, the data aren't very useful for patients. Medicare is only one slice of a physician's practice. Billing and payment data reveal nothing about outcomes, adverse events or how much an individual would have to pay out of pocket. It is not likely that many seniors will avail themselves of these new transparency tools.
On the other hand, one can imagine private insurers sifting the information to see how their rates compare with Medicare rates. Investigators for public and private payers also will be looking for individual and geographic hot spots that might signal overutilization and fraud.
The CMS reported there were nearly 40,000 data downloads last week. It's doubtful many were seniors. One has to assume that sophisticated analysis of the database is already underway.
So what can we expect as these professional users delve into the data? Even the first rough cuts at analysis by the media revealed how transparency of physician claims data could one day contribute to the nationwide effort to eliminate unnecessary costs.
One example will suffice. As Modern Healthcare and other news outlets reported, ophthalmologists represented the professional group receiving the most payments other than general internists. As representatives for that specialty quickly noted, their fees were inflated by payments for an expensive drug used in the treatment of macular degeneration, a common eye malady among seniors.
Lucentis (ranibizumab), developed and manufactured by Genentech, a unit of Roche, costs about $2,000 per monthly treatment. The anti-angiogenesis drug—it stops vision-impairing capillary formation when injected in minute amounts into the eye—is a true miracle of modern medicine. But as a study financed by the National Eye Institute and published in the New England Journal of Medicine in 2011 noted, there's an equally effective alternative called Avastin (bevacizumab), which is available from the same company at one-fortieth of the price.
Indeed, Avastin is essentially the same drug and it does exactly the same thing as Lucentis. The only difference is that it is sold in large vials for treating cancer. Some ophthalmologists had been using it for years before Genetech developed the pricier Lucentis, which is specifically labeled for macular degeneration.
Ophthalmologists' incentives are easily explained. They prefer using the more expensive drug because Congress established a reimbursement scheme for Part B drugs administered in physician offices that includes a 6% markup to pay for the ancillary costs of running an office. Six percent of $2,000 beats 6% of $50 every time.
One can imagine the data revealing dozens of similar scenarios where physicians opted for pricier products or services over equally effective but cheaper alternatives. As researchers and investigators uncover those patterns, it will escalate pressure on Congress to come up with more cost-effective reimbursement mechanisms—ones that reward value, not volume or markups.
Follow Merrill Goozner on Twitter: @MHgoozner