Accountable Care Organizations: Updates to know
Accountable Care Organizations: Updates to know

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Peeking into physician pockets

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Transparency has become a theme in health care reform. In 2014, the transparency spotlight has turned to how much physicians receive from Medicare and the health care industry.

For 33 years, the amount of money that individual physicians received from Medicare was confidential. A lawsuit brought by the American Medical Association and the Florida Medical Association in the 1970’s resulted in an injunction prohibiting the release of Medicare reimbursement information for individual physicians.

In 2013, a Florida federal court judge revisited the issue and held that the federal Privacy Act no longer barred release of reimbursement information under the Freedom of Information Act.

The Centers for Medicare & Medicaid Services (CMS) then drafted regulations to comply with the court ruling. The regulations were announced in January and took effect March 18. Under the regulations, the public—including the news media—does not have an automatic right to the reimbursement records for individual physicians, and, in no case, will names of individual patients be released.

“Case-by-case determination” regarding release 

Instead, in the words of the new policy, CMS “will make a case-by-case determination” about whether to release the information after balancing “the privacy interest of individual physicians and the public interest in disclosure of such information.”

The legal issue involves exemption 6 of the federal Freedom of Information Act, which exempts from the requirement of release of information “personnel and medical files and similar files the disclosure of which would constitute a clearly unwarranted invasion of personal privacy.”

The details of how CMS will administer the new policy are not clear, but the tenor of the policy seems to favor release of information.

Jonathan Blum, Principal Deputy Administrator of CMS, said in the CMS Blog (Jan. 14), “Given the advantages of releasing information on Medicare payment to physicians and the agency’s commitment to data transparency, we believe replacing the prior policy with a new policy in which CMS will make case-by-case determinations is the best next step for the agency.”

Among the benefits projected from the new policy are letting patients see which physicians have the most experience in areas of practice and particular procedures as well as providing data that could help determine if fraud, abuse and waste have occurred.

Broad access vs. safeguards

Some wish CMS had gone further and had opened reimbursement records to the public in a searchable database. The Association of Health Care Journalists, for example, said, “As long as patient confidentiality is protected, we see no reason why taxpayers should not know how individual physicians are spending public dollars.”

Medical associations generally prefer a go-slow approach. The American Medical Association and other physician groups told CMS: “Steps must be taken to ensure that the release of data does not mislead the public into making inappropriate and potentially harmful health care treatment decisions. In light of these considerations, the release of raw data regarding physician claims for providing medical services should be limited for specific purposes and with appropriate safeguards.”

Some physicians also would like a vehicle for presenting the data in context. If a physician received a very high amount of income from Medicare, the physician might want it known if they had very high expenses that offset the income, including rent, office staff, malpractice insurance and equipment.

Sunshine Act to illuminate industry payments

Another area in which the public will be able to obtain information is payments made to physicians by manufacturers of drugs, biologicals, devices and medical supplies. The Affordable Care Act contains a provision called “The Physician Payments Sunshine Act.” The act is modeled on proposals by the Medicare Payment Advisory Commission and the Institute of Medicine.

Under the act, beginning Aug. 1, 2013, manufacturers were obliged to collect data on payments they make to physicians. The payments include consulting fees, honoraria, fees from serving as a speaker at education programs, food and beverages. (For a full list of payments that need to be reported, see the sidebar at the bottom of this page.)

Reports also need to be made if a physician or an immediate family member of the physician have an ownership interest or investment interest in the manufacturer.

Manufacturers are to report the data annually to CMS with the first report due March 31, 2014. The public will have access to the data, including via a searchable website, beginning Sept. 30, 2014.

Payments that do not need to be reported include: ownership of shares in publicly traded companies and mutual funds; loans of devices for periods of 90 days or less; product samples that are provided at no cost to patients; payments with a value of $10 or less (provided the annual total payment to an individual physician does not exceed $100 per year); and educational materials that are of direct benefit to patients.

Physicians are encouraged to contact manufacturers with whom they work to review the manufacturer’s report for accuracy. In addition, under the statute and regulations, after the manufacturers submit reports to CMS, physicians must have at least 45 days to review the report and request corrections before the information is made available to the public.

To assist physicians in tracking payments made to them by manufacturers, free smartphone apps are available through the Google Play Store and the Apple App Store. The title of the app is “Open Payments Mobile for Physicians.”

Health care is increasingly data-driven in efforts to promote quality, control costs and inform consumers. Part of that effort is making available information regarding payments physicians receive from Medicare and from health care manufacturers.

Jeff Atkinson ( teaches health care law at DePaul University College of Law in Chicago.


Jeff Atkinson

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