Medicare spending climbs as physicians provide more tests in their offices

Recently released Medicare billing data shows the government payer's tab for four of the 10 fastest-growing Medicare services rose by $123.5 million from 2012 to 2014, and all four of those services involved new devices, according to a Wall Street Journal analysis.

According to the report, the introduction of new medical devices that allow physicians to provide services in their offices that they previously referred elsewhere has led to the increases in spending.

For example, in 2012, TearLab Corp. introduced a device that allows physicians to perform tear osmolarity — a test to measure the saltiness of tears — in their offices. The test is meant to help physicians determine whether a patient's eyes are too dry. In 2014, about 3,000 providers received $14.8 million in payments for the test, up from $1.75 million in 2012, the year the test was introduced. The tear test was among the 10 fastest-growing services with high billings from 2012 to 2014, according to the report.

The three other fastest-growing services that involved new devices were sweat tests that allow physicians to measure sweat response, electronic brachytherapy — a test that uses radiation devices to treat skin cancer — and electroretinograpy, a test for retina function.

Although new devices are a driver of Medicare spending, the spending growth is attributable to a small group of physicians. According to the analysis, less than 10 percent of physicians accounted for more than 50 percent the rise in spending for each of the four services analyzed.

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