The Department of Health and Human Services (HHS) maintains a computerized database that tracks every Medicare claim filed by providers and every dollar paid out to beneficiaries. The database is accessible by government investigators to detect fraud, but it is unavailable in its entirety to the general public due to a 1979 federal court decision. Over the past year, the Wall Street Journal has fought for access to this data to report on the potential for Medicare claims fraud. Following the publication of Home Care Yields Medicare Bounty (April 27, 2010), the WSJ won a FOIA appeal for conditional access to eight years of partial claims data from the Carrier Standard Analytic File at a reduced cost. Comparable information is available on a limited basis to consultants and researchers who are willing to pay approximately $18,300 for a 5% sample set of one year of data in which the providers' names are encrypted.
The WSJ presented its analysis of the data and cited examples of suspicious billing practices in a five-article series entitled "Secrets of the System":
- In Medicare's Data Trove, Clues to Curing Cost Crisis (October 26, 2010)
- Physician Panel Prescribes the Fees Paid by Medicare (October 27, 2010)
- A Device to Kill Cancer, Lift Revenue (December 8, 2010)
- Top Spine Surgeons Reap Royalties, Medicare Bounty (December 20, 2010)
- Confidentiality Cloaks Medicare Abuse (December 22, 2010)
On January 25, 2011, WSJ's publisher, Dow Jones & Company, filed a Motion to Intervene in the case that is used to keep most Medicare data secret: Florida Medical Association, Inc. v. Department of Health, Education & Welfare, et al (Case No. 78-178-Civ-J-S). Yesterday, the United States Magistrate Judge that reviewed the motion has recommended that it be granted and that the case be reopened for consideration.
Keep reading to learn the history and recent actions related to the Florida Medical Association case.
Court Case Filed After Department of Health, Education & Welfare Released List of Doctors Reimbursed by Medicare (1977)
In 1977, the Department of Health, Education & Welfare (HEW) released a list of doctors that received $100,000 or more in Medicare reimbursements during 1975. After HEW agreed to later release a list of all physicians paid by Medicare, the American Medical Association (AMA) claimed that releasing the information threatened physician privacy. The Florida Medical Association (FMA) was later joined by the AMA in filing a class action lawsuit against HEW in US District Court in Florida. The Plaintiffs alleged that releasing this data would violate, in addition to physician privacy, the Trade Secrets Act, the Social Security Act, the Privacy Act and several FOIA exemptions.
The Court Decision Excludes Medicare Claims Data from FOIA (1979)
On October 22, 1979, Judge Charles R. Scott ruled that releasing the Medicare payments violated FOIA exemption 6 (personal privacy) and the Privacy Act, granting a permanent injunction in the plaintiffs' favor:
"In conclusion, the Court holds that the Secretary's proposed disclosure of a list of annual reimbursements to individually identified providers of services under the Medicare Act (1) is exempt from required disclosure under the FOIA because it would ‘constitute a clearly unwarranted invasion of personal privacy'; (2) is prohibited by the Privacy Act from disclosure, without the prior written consent of each affected individual; and (3) if the guidelines and regulations of OMB and HEW would otherwise authorize and allow such disclosure, they are contrary to the Privacy Act and without force and effect. A permanent injunction on behalf of the plaintiffs and the recertified class that they represent will be issued." (Florida Medical Association et al v. Department of Health, Education & Welfare et al, 479 F. Supp. 1291)
Decision Has Been Upheld in Two Recent Court Cases (2009)
The 1979 decision has been upheld in two recent court cases. In an effort to obtain the data and use it to grade health care providers on quality and performance, a non-profit called Consumers' Checkbook filed a lawsuit against the Department of Health and Human Services (HHS) and the AMA seeking the release of Medicare records. Consumers' Checkbook won a district court ruling in 2007, but the ruling was overturned following an appeal in the US Circuit Court of Appeals for the District of Columbia. In the January 2009 decision available online here, Judge Karen LeCraft Henderson stated that releasing the billing information would serve a "non-existent public interest":
"In sum, the requested data does not serve any FOIA-related public interest in disclosure. Accordingly, we need not balance the non-existent public interest against every physician's substantial privacy interest in the Medicare payments he receives." (Consumers' Checkbook v. Dept. of Health and Human Services et al, "Opinion," United States Court of Appeals for the District of Columbia Circuit, dated January 30, 2009)
The 1979 ruling was again cited later that year in Alley et al v. HHS et al in the United States Court of Appeals for the Eleventh Circuit. In 2003, Jennifer D. Alley requested Medicare claims data that she planned to use for her business assisting hospitals and other clients with marketing and strategy. When HHS cited the 1979 injunction and denied her FOIA request, Alley filed a lawsuit in an Alabama district court which later ordered HHS to release the data. AMA joined HHS in appealing that decision and a three judge panel vacated the lower court's decision in December 2009, stating that HHS was correct in its original decision to deny the Alley FOIA request:
"Because the FMA injunction, reasonably construed, covers the subject matter of Alley's FOIA request, we conclude that HHS did not ‘improperly' withhold those records under the FOIA." (Alley et al v. Dept. of Health and Human Services et al, "Opinion," United States Court of Appeals for the Eleventh Circuit, dated December 19, 2009)
The full decision is available online here.