Medicare Releases Billing Records For The First Time In 30 Years, And The Data Is Startling

New federal data released Wednesday shows that a small number of doctors get paid an outsized portion of Medicare costs, with some netting multi-millions in just a year. The numbers come from 2012, and they paint a striking image — of some 880,000 doctors in the U.S. who accept Medicare, just the top one percent accounted for nearly $11 billion, a whopping 14 percent of the program's payments. Expanded to the top two percent of doctors, the share balloons to $15 billion, nearly one-fifth of the total.

In addition to shining some light on such lavish reimbursements, the data grants perhaps the most insightful glimpse into the Medicare program in its five decades of existence. And it wasn't a sure thing that the public would end up getting the information, either. The American Medical Association, the high-powered physician's group which boasts a membership of 200,000+, has historically worked to block such data from public view, claiming concerns over doctors' rights to privacy.

But that all changed last year when a federal judge, Marcia Morales Howard, lifted a three-decades-old injunction which had kept the information out of the public eye. This was much to the delight of The Wall Street Journal, who spearheaded the effort to have the data released — the ardently pro-business paper first went to court in 2011, which then editor-in-chief Robert Thomson described like this:

The Medicare system is funded by taxpayers, and yet taxpayers are blocked from seeing how their money is spent. It is in the interest of law-abiding practitioners that those who are gaming the system are exposed.

To lend a sense of perspective to the numbers: about $77 billion was paid to Medicare doctors in 2012, while the program's total spending approaches about $600 billion per year. That figure includes not just the money paid out to doctors, but the high price of hospital care, and drug costs as well.

To that end, meaningful efforts to lower Medicare costs almost certainly must be more comprehensive than singling out a klatch of (admittedly egregiously) reimbursed doctors.

That said, those doctors may want to ease off the gas pedal a bit. It's expected that federal regulators will try to identify those who order an unusually high number of expensive procedures, the assumption being that unnecessary services are being performed to drive up the payout.

And that speaks to something potentially more problematic than even the money. It'd be best to avoid a doctor being incentivized, to the tune of millions, to propose pricey and unnecessary procedures. However sparkling the ethics of many of our physicians might be, it's inevitable that such an incentive is going to exert its pull one place or another. And it's an especially dangerous one, as few things could more display a collapse of doctor/patient ethics than urging treatment — which itself might carry risks — when no treatment is needed.

That's certainly the opinion of Steven Grover, a lawyer who specializes in representing whistleblowers who allege Medicare fraud. As he told The New York Times, "There’s going to be a lot of litigation over this."