A Texas physicians group must pay the federal government $8 million after a program to decrease costs for Medicare beneficiaries did the opposite, a judge ruled recently.
Texas Tech Physicians Associates years ago took part in the experiment, which involved using intensive methods to manage spending on high-cost beneficiaries, such as telephone contacts, letters and site visits to coordinate care. The pilot increased costs by 7%, Bloomberg Law reported Friday.
TTPA had challenged methodologies used in the study to determine that costs went up, particularly the composition of the patient control group. A U.S. Court of Appeals judge, however, ruled last week that those claims were meritless, ordering the doc group to pay the $8 million back.
Physicians involved had been allowed to collect millions in extra fees if they hit cost savings of at least 5%. However, TTPA terminated the project early in July 2007 after the Centers for Medicare & Medicaid Services declined to modify the control group in response to an audit that showed costs rose 7% or the intervention group. Government officials said doing so was “not feasible” and an investigation of disparities between the two groups did not reveal “any reasonable adjustments that could produce a match…that mitigated disparities,” according to court documents.
Texas Tech noted that two features of that intervention group explained higher costs — more deaths and more patients living in nursing homes.
For more than a decade, the government has requested the return of the funds. The physician group filed an administrative challenge in 2013 that eventually worked its way up to the Fifth Circuit Court, Bloomberg reported.