II 111th CONGRESS 2d Session S. 3216 IN THE SENATE OF THE UNITED STATES April 15, 2010 Mr. Grassley introduced the following bill; which was read twice and referred to the Committee on Finance A BILL To amend title XVIII of the Social Security Act to ensure Medicare beneficiary access to physicians, to ensure equitable reimbursement under the Medicare program for all rural States, and to eliminate sweetheart deals for frontier States.

1.

Short title

This Act may be cited as the Medicare Rural Health Care Equity Act of 2010.

2.

Revisions to the practice expense geographic adjustment under the Medicare physician fee schedule

Effective as if included in the enactment of the Patient Protection and Affordable Care Act (Public Law 111–148), subparagraph (H) of section 1848(e)(1) of the Social Security Act (42 U.S.C. 1395w–4(e)(1)), as added by section 3102(b) of the Patient Protection and Affordable Care Act, is amended to read as follows: (H)

Practice expense geographic adjustment for 2010 and subsequent years

(i)

For 2010

Subject to clause (iii), for services furnished during 2010, the employee wage and rent portions of the practice expense geographic index described in subparagraph (A)(i) shall reflect 1/2 of the difference between the relative costs of employee wages and rents in each of the different fee schedule areas and the national average of such employee wages and rents. (ii)

For 2011

Subject to clause (iii), for services furnished during 2011, the employee wage and rent portions of the practice expense geographic index described in subparagraph (A)(i) shall reflect 1/4 of the difference between the relative costs of employee wages and rents in each of the different fee schedule areas and the national average of such employee wages and rents. (iii)

Hold harmless

The practice expense portion of the geographic adjustment factor applied in a fee schedule area for services furnished in 2010 or 2011 shall not, as a result of the application of clause (i) or (ii), be reduced below the practice expense portion of the geographic adjustment factor under subparagraph (A)(i) (as calculated prior to the application of such clause (i) or (ii), respectively) for such area for such year. (iv)

Analysis

The Secretary shall analyze current methods of establishing practice expense geographic adjustments under subparagraph (A)(i) and evaluate data that fairly and reliably establishes distinctions in the costs of operating a medical practice in the different fee schedule areas. Such analysis shall include an evaluation of the following: (I)The feasibility of using actual data or reliable survey data developed by medical organizations on the costs of operating a medical practice, including office rents and non-physician staff wages, in different fee schedule areas. (II)The office expense portion of the practice expense geographic adjustment described in subparagraph (A)(i), including the extent to which types of office expenses are determined in local markets instead of national markets. (III)The weights assigned to each of the categories within the practice expense geographic adjustment described in subparagraph (A)(i). In conducting such analysis, the Secretary shall not take into account any data that is not actual or survey data.(v)

Revision for 2012 and subsequent years

As a result of the analysis described in clause (iv), the Secretary shall, not later than January 1, 2012, make appropriate adjustments to the practice expense geographic adjustment described in subparagraph (A)(i) to ensure accurate geographic adjustments across fee schedule areas, including— (I)basing the office rents component and its weight on occupancy costs only and making weighting changes in other categories as appropriate; (II)ensuring that office expenses that do not vary from region to region be included in the other office expense category; and (III)considering a representative range of professional and non-professional personnel employed in a medical office based on the use of the American Community Survey data or other reliable data for wage adjustments. Such adjustments shall be made without regard to adjustments made pursuant to clauses (i) and (ii) and shall be made in a budget neutral manner.(vi)

Special rule

If the Secretary does not complete the analysis described in clause (iv) and make any adjustments the Secretary determines appropriate for 2012 or a subsequent year under clause (v), the Secretary shall apply clause (ii) for services furnished during 2012 or a subsequent year in the same manner as such clause applied for services furnished during 2011. .

3.

Elimination of sweetheart deal that increases Medicare reimbursement just for frontier States

Effective as if included in the enactment of the Patient Protection and Affordable Care Act (Public Law 111–148), section 10324 of such Act (and the amendments made by such section) is repealed.