Diabetes Self-Management Blog

For a long time, health policy experts have debated to what extent differences in Medicare spending — by region or by provider, among other ways of looking at the data — represent fraud or wasteful spending in those regions or practices where Medicare tends to get bigger bills for similar patients. Given that hospitals and large medical practices enjoy strong political power in most states, it is unlikely that Congress will allow any drastic changes in Medicare’s payment system to happen anytime soon. But the Centers for Medicare and Medicaid Services (CMS), the federal agency that runs Medicare, is proposing a change that may nevertheless lead to changes in how much doctors and hospitals bill Medicare: making Medicare payment information open to the public.

CMS already releases some data on Medicare spending, such as average per-patient spending related to a hospital stay (including rehab and other follow-up care) by state and by individual hospital. Average spending per patient related to a hospital stay varies enormously between hospitals, from less than $10,000 at two hospitals in California and New Mexico to more than $30,000 at a hospital in Texas, as shown in a study released by Medicare earlier this year (the national median is just below $18,000). Major differences were not just seen in different states or regions, however. According to a Kaiser Health News article on the study, one community hospital in Los Angeles billed an average of almost $25,000 per patient, while at a major university research hospital across town, the average bill was only $17,628. Of course, the conditions that are being treated vary from one hospital to another, which is why Medicare did the best it could to control for the mix of cases that hospitals see, as well as factors unrelated to care that affect a hospital’s reimbursement rates (for example, Medicare gives larger payments to hospitals whose employees earn higher wages).

But controlling for the mix of health conditions being treated, it turns out, may not be enough to accurately compare the bills that hospitals and other care providers rack up. Some researchers have long asserted that at some hospitals and in some regions of the country, doctors are more likely to aggressively diagnose health conditions in situations where they have the discretion to do so. For example, earlier this year, researchers at Dartmouth University found that in areas of the country with high per-patient Medicare spending, clear-cut conditions such as hip fractures were only slightly more common than the national average, while conditions that allow greater doctor discretion in diagnosis were seen at a rate far above the national average. As another Kaiser Health News study notes, however, this finding was disputed by another study from earlier this year, which found that Medicare spending on all health conditions, by region and by hospital, closely tracks spending on clear-cut conditions such as major head injuries, heart attacks, and amputations.

One reason, then, for CMS to release more detailed information on Medicare payments — down to the procedures billed by individual doctors — would be to give researchers more data to make comparisons between doctors, hospitals, and regions. While it’s entirely possible — and even likely — that certain areas of the country are sicker than others (when it comes to Type 2 diabetes, this is undeniably true), it is also possible that the medical or corporate culture in certain regions or individual hospitals leads to more procedures being performed and billed to Medicare. A recent survey of doctors found them fairly split on the question of whether Medicare payment information should be made public: 42% supported the idea, while 46% opposed it; 12% weren’t sure.

What do you think — would releasing detailed Medicare payment information violate doctors’ privacy, or does the public’s interest in taxpayer money being spent wisely override this concern? Would you be concerned if you found out that your doctor billed significantly more, or less, to Medicare than is typical? Do you think public scrutiny could push doctors who bill Medicare too freely to change the way they practice medicine? Could this public scrutiny be a bad thing or backfire? Leave a comment below!


  1. Transparency is always a good way to communicate using tax payers funding. Personally I would not object to having any info about cost known to the public. I do wonder what the physicians and hospital Admin. may think about this more public information.

    Guess this is the point!

    Posted by joan |
  2. Doctor’s are running a business and should do so with integrity and ethics. If they overcharge the Medicare system, they ought to be held accountable. My basic concern about releasing Medicare payment information is that the patient privacy must be protected. No one, even the government, needs to know about a patient’s health issues.

    Posted by Ron Stotyn |
  3. I called Medicare one time about fraud going on in our clinic and they didn’t care. They weren’t interested in hearing about it. If something was done about fraud there would be more money available.

    Posted by Ferne |

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