[Congressional Record Volume 152, Number 77 (Thursday, June 15, 2006)]
[Senate]
[Page S5952]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. BINGAMAN (for himself, Ms. Snowe, Mr. Cochran, Ms. 
        Cantwell, Mr. Domenici, Mrs. Lincoln, Mr. Jeffords, Ms. 
        Collins, Mrs. Murray, Mr. Harkin, Ms. Landrieu, Mr. Obama, Mr. 
        Salazar, and Mr. Sessions):
  S. 3516. A bill to amend title XVIII of the Social Security Act to 
permanently extend the floor on the Medicare work geographic adjustment 
under the fee schedule for physicians' services; to the Committee on 
Finance.
  Mr. BINGAMAN. Mr. President, I am introducing legislation today with 
Senators Snowe, Cochran, Cantwell, Domenici, Lincoln, Jeffords, 
Collins, Murray, Harkin, Landrieu, Obama, Salazar, and Sessions 
entitled the ``Rural Equity Payment Index Reform Extension Act of 
2006.'' The legislation would extend a provision that was included as 
part of the Medicare Modernization Act of 2003 and came from my 
original legislation, S. 881 in the 108th Congress, with Congressman 
Doug Bereuter of Nebraska to ensure that the work component of the 
Medicare physician payment formula is set to ensure that no geographic 
region is paid less than the national average.
  The Medicare physician payment formula, known as the Medicare 
Resource-Based Relative Value Scale, or RBRVS, is based on three 
components of each service: work, practice expense, and professional 
liability insurance. The relative value of each service is then 
multiplied by a geographic adjuster for each Medicare locality, which 
is known as the Geographic Practice Cost Indices, or GPCIs.
  Prior to the enactment of this provision as part of the Medicare 
Modernization Act of 2003, the physicians in States that have the worst 
workforce shortages were being paid far less than their counterparts in 
States with adequate or even an oversupply of physicians due to the 
GPCI adjustment. For the ``work component'' in particular, which 
accounts for about 55 percent of the total Medicare physician payment, 
an adjustment based on geographic adjustments made little sense. An 
office visit to a rural physician is no different in time, effort, or 
workload compared to an office visit to an urban physician.
  As National Rural Health Association president Dr. Wayne Myers said 
on January 7, 2003, prior to the legislation's passage, ``An office 
visit to a rural physician is no different than an office visit to an 
urban physician. The idea that physicians are reimbursed for their work 
and their skills at a lower rate simply on the basis that they choose 
to practice in a rural area and serve our rural communities is 
completely ludicrous.''
  In addition, since Medicare beneficiaries pay the same premium for 
all Part B services, inequitable physician fee payments result in 
substantial cross-subsidization from people living in low payment 
States to people living in higher payment States.
  Congress determined that such extensive geographic disparities were 
unfair and, as part of the Medicare Modernization Act of 2003, language 
from my bill was included that brought all geographic areas up to the 
national average for the calculation of this piece of the Medicare 
physician payment formula.
  It is important to highlight that the importance of this formula 
extends well beyond Medicare. According to the American Academy of 
Pediatrics in its February 8, 2006, update on the Medicare payment 
formula, ``. . . over 74 percent of public and private payors, 
including state Medicaid programs, have adopted components of the 
Medicare RBRVS to reimburse physicians, while many other payors are 
exploring its implementation.''
  Furthermore, Medicare Advantage plan payments are based in large part 
on fee-for-service payments made in various geographic locations. 
Disparities in Medicare Advantage payments are also caused, in part, by 
such geographic adjustments made to physician payments.
  Unfortunately, these disparities will increase if the ``work 
component'' in the physician payment rate is allowed to once again 
fully adjust based on geography. The provision bringing payment levels 
up to the national average for every geographic area was in effect for 
2004-2006 and is set to expire at the end of this calendar year. As a 
result, physicians, who already face a potential reduction in their 
overall Medicare payment rate, might also see their payment rates 
further reduced unless this legislative extension is passed.
  According to the November 21, 2005, Federal Register notice, if 
payment rates were not brought up to the national average, there would 
be reductions in physician payments to the following States: Alabama, 
Arizona, Arkansas, Colorado, Florida, Georgia outside of Atlanta, 
Idaho, parts of Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, 
Maine, Maryland outside of Baltimore region, Michigan outside of 
Detroit, Minnesota, Mississippi, Missouri, Montana, Nebraska, New 
Hampshire, New Mexico, most of New York outside of New York City and 
suburbs, North Carolina, North Dakota, Ohio, Oklahoma, Oregon outside 
of Portland, Pennsylvania outside of Philadelphia, Puerto Rico, South 
Carolina, South Dakota, Tennessee, Texas outside of Houston, Dallas, 
and Brazoria, Utah, Vermont, Virginia, Washington outside of Seattle, 
West Virginia, Wisconsin, and Wyoming.
  Lack of equitable reimbursement is a critical factor leading to the 
shortage of physicians in many rural areas, including the State of New 
Mexico. The extension of the Rural Equity Payment Index Reform 
Extension Act of 2006 will ensure that the disparity in physician 
payments between states such as New Mexico and other geographic areas 
does not once again widen.
  I urge prompt passage of this important legislation and ask unanimous 
consent that the text of the bill be printed in the Record.
  There being no objection, the text of the bill was ordered to be 
printed in the Record, as follows:

                                S. 3516

       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 ``Rural Equity Payment Index 
     Reform Extension Act of 2006''.

     SEC. 2. PERMANENT EXTENSION OF FLOOR ON MEDICARE WORK 
                   GEOGRAPHIC ADJUSTMENT.

       Section 1848(e)(1)(E) of the Social Security Act (42 U.S.C. 
     1395w-4(e)(1)(E)) is amended by striking ``and before January 
     1, 2007,''.
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