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Increased Availability of Health Care Data Means More Oversight and More Litigation

Written by:  Ellyn L. Sternfield

The increasing availability of health care claims and payment data may portend the future of government and private health care enforcement and litigation

Data is the lifeblood of health care fraud enforcement efforts.  For many years, Medicare enforcement was hampered by CMS’s use of multiple Medicare contractors to pay and process Medicare claims.  In late 2010, I wrote about how this could change with the allocation of more than $350 million to create integrated Medicare and Medicaid databases designed to enhance government health care fraud detection and enforcement efforts.  It now appears that the future is here.

OIG Report on Medicare Part D Data

Last week, the OIG issued a Report analyzing 2009 Medicare Part D data.  The Report finds that of 1.1 million individual medical practitioners who had prescribed drugs paid for through Part D, 736 general practitioners were “extreme outliers” in terms of five key measures:

  • The average number of prescriptions written per beneficiary;
  • The number of pharmacies filling that provider’s prescriptions;
  • The percentage of prescriptions for Schedule II drugs;
  • The percentage of prescriptions for Schedule III drugs; and
  • The percentage of prescriptions for brand name drugs.   

The data analysis uncovered some eye-popping statistics.   One physician was responsible for prescriptions filled by 872 different pharmacies located in 47 states and Guam, another averaged more than 71 prescriptions per individual beneficiary, and another ordered more than 400 prescriptions for each of 16 beneficiaries.  In 2009, Medicare paid more than $352 million on prescriptions written by the 736 physicians identified as extreme outliers.

The Report provides government prosecutors with a roadmap for potential enforcement.  It also illustrates what may be the future of public and private health care fraud enforcement as more and more health care payment data becomes publicly available.  Not only government prosecutors, but also individuals with their own agendas, will be able to analyze the data for aberrations and outliers.

CMS Release of Medicare Claims Processing Data

In recent months, CMS has begun publicly releasing Medicare claims processing data, including hospital charge data for specified outpatient and inpatient treatments.   Multiple media reports have already pointed out discrepancies in the hospital prices reflected in the data.  CMS promises that more health care data will be forthcoming. 

Injunction on Release of Physician Payment Information Overturned

On May 31, 2013, a federal judge overturned an injunction that had been in place for 33 years, which had prevented the release of information on what Medicare pays individual physicians.   The injunction was initially issued at the request of the Florida Medical Association, which argued that release of information on what Medicare paid the physicians constituted an unwarranted invasion of personal privacy, reasoning the judge found “no longer equitable.”    

Medicare Data Access Bill Introduced

After this injunction was lifted, legislation was introduced in the Senate to make Medicare payment data publicly available in a free, searchable database.  The Medicare Data Access for Transparency and Accountability Act would also affirm that data on Medicare payments to physicians and suppliers is public information, not exempt from disclosure under the Freedom of Information Act.  The bill does not address whether publication of the data constitutes public disclosure for purposes of qui tams brought under the federal or state false claims acts. 

It is clear that through integrated databases, government investigators are gaining enhanced access to Medicaid and Medicare data that will be mined and analyzed to develop future health care enforcement cases.  It is also clear that insurers, the media, class action counsel, and potential qui tam whistleblowers also may soon be mining this newly available data to identify potential outliers and develop their own health care based litigation efforts.   


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Theresa advises clients on all aspects of the pharmaceutical supply chain, including counseling industry stakeholders on a range of business, legal, transactional, and compliance matters. She provides clients with strategic counseling and creative business modeling that considers legal restrictions and regulatory risk in light of innovation and business goals.