[Congressional Record Volume 148, Number 63 (Thursday, May 16, 2002)]
[Senate]
[Pages S4501-S4503]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. BINGAMAN (for himself, Mr. Thomas, Mr. Murkowski, Mr. 
        Torricelli, Mr. Harkin, Mrs. Clinton, and Mr. Johnson):
  S. 2529. A bill to amend title XVIII of the Social Security Act to 
improve the medicare incentive payment program; to the Committee on 
Finance.
  Mr. BINGAMAN. Mr. President, the legislation I am introducing today 
with Senators Thomas, Murkowski, Torricelli, Harkin, Clinton, and 
Johnson entitled ``The Medicare Incentive Payment Program Improvement 
Act of 2002'' is designed to improve the flow of needed bonus payments 
to physicians serving Medicare patients in health professions shortage 
areas, HPSA.
  In my own State the flight of physicians from underserved areas has 
affected both primary care and specialty services alike. In many areas 
the shortages of specialists exceeds that of primary care physicians. 
The New Mexico Health Policy Commission reported in its year 2000 
report that 22 percent of residents in Los Alamos and Santa Fe were 
unable to receive needed specialist care.
  With only 170 physicians per 100,000 people, New Mexico ranks well 
behind the national average with regard to primary care and specialist 
physicians. The physician shortage problem is further compounded by the 
disproportionate decline in physicians from rural and underserved 
areas.
  New Mexico, like many States, has a growing proportion of its rural 
population becoming older and sicker. According to the latest census, 
over 20 million of our citizens live in physician shortage areas.
  Lack of adequate reimbursement, in the face of increasing costs, is a 
critical factor leading to the shortage of physician services in HPSAs. 
Physicians flee rural and shortage areas for many reasons including 
inadequate reimbursement, family hardships and quality-of-life issues. 
Although it is beyond our scope to address all these issues, we can fix 
the reimbursement component.
  The Medicare Incentive Payment Program, MIPP, created by the Omnibus 
Budget Reconciliation Act of 1987, was meant to assist physicians in 
defraying the higher costs and burdens of serving Medicare patients in 
shortage areas. These 10 percent ``bonuses'' are an essential component 
in our ongoing effort to ensure Medicare beneficiaries access to 
medical services.
  Unfortunately the Medicare Incentive Payment Program has fared 
poorly, with few providers choosing to receive the payments. In fact, 
the total annual physician payments have never exceeded $100 million 
because of a series of disincentives in the legislation.
  The program requires a provider to do a number of things to obtain 
the bonus payments. First, providers must be aware that NIPP payments 
are available to them. Many providers are unaware of the program's 
existence. Next, physicians must find out if the patient's medical care 
occurred in a shortage area. Following this a unique code must be 
attached to the Medicare claim, which is then forwarded to the carrier. 
Finally, after all these steps, providers are subjected to automatic 
Medicare audits, just for accepting these payments.
  Providers committed to serving Medicare patients in underserved areas 
deserve the support assured by the original legislation's intent.
  The Medicare Incentive Payment Improvement Act of 2002 addresses and 
improves shortcomings in the original legislation by: placing the 
burden for determining the bonus eligibility on the Medicare carrier; 
eliminating automatic provider audits; directing the Center for 
Medicare and Medicaid Services to establish a Medicare incentive 
payment program educational program for providers; establishing an 
ongoing analysis of the programs' ability to improve Medicare 
beneficiaries access to physician services; continue to provide the 
original 10 percent add-on bonus for Part B physician payments in 
health provider shortage areas.
  Medicare carriers are the logical arbiters to determine whether 
physician services occurred in a shortage area. Physicians, already 
overworked, lack sufficient time, resources, and training to research 
and determine whether a service was provided in a HPSA. By placing the 
responsibility on carriers, with their sophisticated information 
systems, the physician's administrative burdens will be reduced.
  The automatic audits triggered by this program, costly, time 
intensive, and unwarranted, will be lifted under our legislation. By 
placing the responsibility on carriers to determine payment eligibility 
the need for provider audits is eliminated.
  While the MIPP program is intended to improve beneficiaries' access 
to physician services, there is no measure of the program's effect on 
physician availability. The legislation offered today directs CMS, to 
perform, as ongoing analysis, whether these payments actually do 
improve beneficiaries access to physician services.
  I believe these improvements, in addition to others listed above, 
will greatly improve patient's access to care.
  The following organizations have expressed their support for this 
legislation: American College of Physicians/American Society of 
Internal Medicine, the American Academy of Family Physicians and the 
American Geriatrics Society.
  Mr. President, I ask unanimous consent that a fact sheet, letters of 
support, and the text of the bill be printed in the Record.

[[Page S4502]]

  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                                S. 2529

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Medicare Incentive Payment 
     Program Improvement Act of 2002''.

     SEC. 2. PROCEDURES FOR SECRETARY, AND NOT PHYSICIANS, TO 
                   DETERMINE WHEN BONUS PAYMENTS UNDER MEDICARE 
                   INCENTIVE PAYMENT PROGRAM SHOULD BE MADE.

       Section 1833(m) of the Social Security Act (42 U.S.C. 
     1395l(m)) is amended--
       (1) by inserting ``(1)'' after ``(m)''; and
       (2) by adding at the end the following new paragraph:
       ``(2) The Secretary shall establish procedures under which 
     the Secretary, and not the physician furnishing the service, 
     is responsible for determining when a payment is required to 
     be made under paragraph (1).''.

     SEC. 3. EDUCATIONAL PROGRAM REGARDING THE MEDICARE INCENTIVE 
                   PAYMENT PROGRAM.

       The Secretary of Health and Human Services shall establish 
     and implement an ongoing educational program to provide 
     education to physicians under the medicare program on the 
     medicare incentive payment program under section 1833(m) of 
     the Social Security Act (42 U.S.C. 1395l(m)).

     SEC. 4. ONGOING STUDY AND ANNUAL REPORT ON THE MEDICARE 
                   INCENTIVE PAYMENT PROGRAM.

       (a) Ongoing Study.--The Secretary of Health and Human 
     Services shall conduct an ongoing study on the medicare 
     incentive payment program under section 1833(m) of the Social 
     Security Act (42 U.S.C. 1395l(m)). Such study shall focus on 
     whether such program increases the access of medicare 
     beneficiaries who reside in an area that is designated (under 
     section 332(a)(1)(A) of the Public Health Service Act (42 
     U.S.C. 254e(a)(1)(A))) as a health professional shortage area 
     to physicians' services under the medicare program.
       (b) Annual Reports.--Not later than 1 year after the date 
     of enactment of this Act, and annually thereafter, the 
     Secretary of Health and Human Services shall submit to 
     Congress a report on the study conducted under subsection 
     (a), together with recommendations for such legislation and 
     administrative actions as the Secretary considers 
     appropriate.
                                  ____


 The Medicare Incentive Payment Program Improvement Act of 2002--Fact 
                                 Sheet

       The proposed legislation by Sen. Jeff Bingaman (D-NM) will 
     improve the flow of needed bonus payments to physicians 
     serving Medicare beneficiaries in Health Professions Shortage 
     Areas (HPSA's). These providers care for patients under 
     difficult circumstances without the financial or 
     infrastructure resources of their colleagues practicing in 
     non-shortage areas.
       The Act streamlines the flow of a 10% bonus payment for all 
     part-B physicians services provided in geographic HPSA's. In 
     addition, the legislation further improves the existing 
     Medicare Incentive Payment Program by reducing the 
     administrative burden to providers and providing an 
     educational program.
       The Medicare Incentive Payment Program was initially 
     created and later modified under the Omnibus Budget 
     Reconciliation Acts of 1987 and 1989. The program has fared 
     poorly with little uptake by providers. Total payments fell 
     following the 1997 Balanced Budget Amendment with total 
     payments of $100 million in 1996 and $90 million in 1997.
       The present program requires a provider to have knowledge 
     of and perform a number of items in order to obtain the 
     payment.
       Have knowledge the program exists. Many providers are 
     unaware of the bonuses.
       Determine if the patient encounter took place in a 
     geographic HPSA.
       Attach the proper modifier to the claim.
       Undergo a stringent audit process by the intermediary. This 
     risk alone deters many providers from participation.
       The MIP program although sound in concept has proven 
     difficult to execute. In order for the programs initial goals 
     to be fully realized it must be utilized, i.e., payment to 
     providers serving Medicare beneficiary's in geographic HPSA's
       The Medicare Incentive Program Improvment Act of 2002 will:
       Continue to provide the 10% add on bonus to all Part-B 
     payments in Geographic HPSA's.
       Place the responsibility for determining bonus eligibility 
     on the Medicare carrier.
       Eliminate the audit burden.
       Call for the Center for Medicare and Medicaid Services to 
     establish a MIP Educational Program for providers.
       Establish an ongoing analysis of the programs ability to 
     improve Medicare's patient's access to physician services.
                                  ____



                                                     ACP-ASIM,

                                                   April 17, 2002.
     Hon. Jeff Bingaman,
     U.S. Senate,
     Washington, DC.
       Dear Senator Bingaman: On behalf of the American College of 
     Physicians-American Society of Internal Medicine (ACP-ASIM), 
     we wish to extend our support for your draft Medicare 
     Incentive Payment (MIP) Program legislation. ACP-ASIM--
     represents 115,000 physicians and medical students--is the 
     largest medical specialty society and second largest 
     physician organization in the United States. Internists 
     provide care to more Medicare patients than any other 
     physician specialty.
       The MIP Program provides a 10 percent bonus payment to 
     physicians serving Medicare patients in geographic Health 
     Professions Shortage Areas (HPSA). We support provisions in 
     your proposal that seeks to improve the existing MIP Program 
     by placing the burden for determining the bonus eligibility 
     on the Medicare carrier, and not the individual physician. In 
     addition, we support provisions in the proposal that require 
     the Center for Medicare and Medicaid Services (CMS) to 
     establish a MIP educational program for providers, and also 
     establish initiatives that provide an analysis of the 
     programs ability to improve Medicare beneficiary's access to 
     physician services. We hope these initiatives will provide 
     needed incentives to recruit and retain physicians into 
     shortage areas.
       While we support the draft MIP legislation, we are 
     concerned that unless Congress fixes the overall physician 
     payment update formula within the Medicare program, a 10 
     percent bonus of a declining payment will not solve the 
     problem of physicians providing services to patients in HPSA. 
     Therefore, we hope you will continue to be supportive of a 
     legislative solution to replace the seriously flawed formula 
     in current law for updating the Medicare physician fee 
     schedule, and base annual updates on changes in physicians' 
     input prices as has been recommended by the Medicare Payment 
     Advisory Commission in its March 1 Report to Congress. If 
     left in place, the current update methodology, tied to the 
     performance of the overall economy, will lower Medicare 
     payments for physician services by 28.1 percent in real terms 
     by 2005.
       Thank you again, Senator Bingaman for your continued 
     leadership to the present and future viability of the 
     Medicare program.
           Sincerely,
                                                   Sara E. Walker,
     President.
                                  ____



                              The American Geriatrics Society,

                                                     May 16, 2002.
     The Hon. Jeff Bingaman,
     United States Senate, Washington, DC.
       Dear Senator Bingaman: The American Geriatrics Society 
     (AGS), an organization of over 6,000 geriatricians and other 
     health care professionals who are specially trained in the 
     management of care for frail, chronically ill older patients, 
     extends our support for your draft Medicare Incentive Payment 
     (MIP) Program legislation.
       The MIP Program provides a 10 percent bonus payment to 
     physicians serving Medicare patients in Geographic Health 
     Professions Shortage Areas (HPSA). We support provisions in 
     your proposal that seek to improve the existing MIP by 
     placing the burden for determining the bonus eligibility on 
     the Medicare carrier, and not the individual physician. 
     Finally, we support provision that would improve our ability 
     to provide Medicare beneficiary access to physician services 
     under the MIP Program.
       We look forward to working with you on this and other 
     important Medicare initiatives during this Congress. If you 
     should have comments or questions on this letter, please 
     contact Susan Emmer in our Washington office at 301-320-3873.
           Sincerely,
                                        Kenneth Brummel-Smith, MD,
     President.
                                  ____

                                               American Academy of


                                            Family Physicians,

                                                     May 16, 2002.
     Hon. Jeff Bingaman,
     U.S. Senate,
     Washington, DC.
       Dear Senator Bingaman: The American Academy of Family 
     Physicians and its 93,500 members nationwide commend you for 
     introducing the ``Medicare Incentive Payment Program 
     Improvement Act of 2002.'' This bill would make any physician 
     practicing in a Health Professional Shortage Area (HPSA) 
     eligible for a ten-percent bonus. The bill would also charge 
     the Secretary of Health and Human Services to conduct an 
     ongoing program to provide education to physicians on the 
     Medicare Incentive Payment (MIP) program. The Secretary would 
     also be directed to conduct an ongoing study of the MIP 
     program, which shall focus on whether such a program 
     increases the access to physicians' services for those 
     Medicare beneficiaries who reside in a HPSA.
       Created in 1989, the MIP program provides bonus payments to 
     physicians who practice in HPSAs in an effort to entice more 
     physicians to those areas. According to a Medicare Payment 
     Advisory Commission (MedPAC) report dated June 2001, a recent 
     decline in the bonus payments to physicians has caused 
     concern that several aspects of the program design are 
     compromising its effectivess.
       For example, currently the MIP ten-percent bonus is paid to 
     physicians practicing in HPSAs only upon submission of the 
     claim form with a special coding modifier attached to each 
     service identified. Since the bonus payment is predicated 
     upon the use of this special coding modifier, and since, due 
     to the inherent instability of the HPSA designation, 
     physicians cannot always be certain if they are practicing in 
     a shortage area, the use of the MIP has been less than 
     expected.

[[Page S4503]]

       In 1996, 75 percent of participating rural physicians, or 
     about 18,700 doctors, received less than $1,520 each in bonus 
     payments for the year. In addition to the complexities 
     described above, the low level of payments may be 
     attributable to carriers being required to review claims of 
     physicians who receive the largest bonus payments. A 1999 
     study by the Health Care Financing Administration (HCFA) 
     suggested this policy may discourage physicians from applying 
     for the MIP program. More importantly, a 1999 General 
     Accounting Office (GAO) report suggested the ten-percent 
     bonus payments may be insufficient to have a significant 
     influence on recruitment or retention of primary care 
     physicians.
       The American Academy of Family Physicians urges Congress to 
     pass the ``Medicare Incentive Payment Program Improvement Act 
     of 2002,'' which would make any physician practicing in a 
     HPSA automatically eligible for the ten-percent bonus without 
     having to engage in any special billing or coding processes 
     or submitting to a higher level of claims review. Such action 
     will ensure that rural Medicare patients can continue to 
     receive the care they depend on and deserve. Please let us 
     know how we can assist in the effort to gain support for this 
     important legislation.
           Sincerely,
                                               Richard G. Roberts,
                                                      Board Chair.

  Mr. THOMAS. Mr. President, I am pleased to rise today to introduce 
the Medicare Incentive Payment Program Improvement Act of 2002 with my 
distinguished colleague Senator Bingaman. This legislation makes 
important improvements to the current Medicare Incentive Payment, MIP 
Program. These refinements will go a long way in ensuring eligible 
rural physicians receive the Medicare bonus payment to which they are 
entitled.
  The Medicare Incentive Payment Program was created in 1987 under the 
Omnibus Budget Reconciliation Act to serve as an incentive tool to 
recruit physicians to practice in Health Professional Shortage Areas, 
HPSAs, by providing a 10-percent Medicare bonus payment. There are 
approximately 2,800 federally designated HPSAs--75 percent of which are 
located in rural areas. In my State of Wyoming, over half of the 
counties are designated as a health professional shortage area and have 
a difficult time recruiting physicians.
  Unfortunately, this well-intended program has not worked well due to 
the burden it places on providers. Under the current MIP programmatic 
structure, physicians are required to determine if the patient 
encounter occurred in a designated underserved areas, they must attach 
a code modifier to the billing claim and must undergo a stringent 
audit. Additionally, there is evidence that many physicians who would 
be eligible are not even aware of the program.
  Therefore, the legislation we are introducing today alleviates the 
administrative burden on rural physicians by requiring Medicare 
carriers to determine eligibility. The Medicare Incentive Payment 
Program Improvement Act of 2002 also requires the Centers for Medicare 
and Medicaid Services to establish a MIP education program for 
providers and establishes ongoing analysis of the MIP Program's ability 
to improve access to physician services for Medicare beneficiaries.
  All physicians are currently struggling with the recent Medicare 
payment reduction of 5.4 percent in addition to the ever-increasing 
regulatory burden of participating in the Medicare Program. As rural 
providers tend to be disproportionately impacted by Medicare payment 
cuts, it has never been more important to ensure that the few rural 
physician incentive programs that exist have a positive effect on the 
stability of our rural health care delivery system. I strongly urge all 
my Senate colleagues interested in rural health to cosponsor the 
Medicare Incentive Payment Program Improvement Act of 2002.

                          ____________________