Congress passes California Medicare GPCI fix April 4, 2014 Medicare Rural Health, Geographic Practice Cost Index, GPCI, Medicare 0 After 10 long years of lobbying efforts by the California Medical Association (CMA), Congress has finally passed a bill to update California's outdated Medicare localities. The long overdue fix will update California’s Medicare physician payment regions to the same Metropolitan Statistical Areas (MSA) used to pay hospitals and raise payment levels for urban counties misclassified as rural, while holding remaining rural counties harmless from cuts. The MSAs used to determine payment rates for hospitals are continuously updated, so that reimbursement accurately reflects local costs to deliver care. The physician payment localities, on the other hand, have not been updated in 15 years. As a result, 14 urban California counties are still designated as rural. This has caused many California physicians to be paid up to 13 percent per year below what Medicare says they should be paid if they were in the correct region. These counties are currently experiencing significant access to care problems. About a third to one half of the physician groups and hospitals in these regions report difficulty recruiting physicians to treat seniors because the cost of living and the cost to practice are high, but the Medicare locality payments have not kept pace with real costs. For instance, San Diego is now the sixth largest city in the United States, yet under the old Medicare localities, it is still designated by as rural. San Diego physicians and patients alone lose $26 million in Medicare funding each year because of the inaccurate rural designation. The locality update (known as the California "GPCI fix") is part of the “Protecting Access to Medicare Act of 2014” bill passed by the House and Senate last week to postpone for one year the 24 percent cut to Medicare physician payments as called for under the fatally flawed sustainable growth rate (SGR). The bill (H.R. 4302) was signed into law by the President on April 1. The California GPCI fix will increase payments to physicians in 14 counties by $50 million annually to over $400 million in the next decade. The rate increase begins in 2017 and will be phased in each year until full implementation in 2022. The counties poised to see reimbursement increases are San Benito, Santa Cruz, Marin, Santa Barbara, San Diego, Monterey, Sonoma, Placer, El Dorado, Yolo, Sacramento, San Luis Obispo, Riverside and San Bernardino. Because private health plans in these areas tie their fee schedules to the Medicare fee schedule, this will help access to care for all California patients, not just Medicare seniors. Locality 3 counties of Napa and Solano and Locality 99’s remaining rural counties will be held harmless from cuts. (In other words, their geographic rates will never be lower than their current rates.) Their rates can increase as costs go up but they will never be cut below the current floor. San Francisco, Santa Clara, San Mateo, Alameda, Contra Costa, Orange, Ventura and Los Angeles counties have always been in their own localities and reimbursed at their local costs to provide care. This will continue under the MSA system. This is a huge win for California patients and physicians. It will maintain and improve access to care in many regions of California. CMA has many California Members of Congress to thank for the herculean bipartisan team effort to finally get the California locality reform through Congress and signed into law. CMA extends its strongest thank you to our long-time Congressional GPCI quarterback, Congressman Sam Farr (D-Santa Cruz, San Benito, Monterey) for his perseverance to see this through. Congressman Farr and Congressman Darrell Issa (R-San Diego) led the Congressional effort and were extremely effective in passing this law. CMA also extends its gratitude to Congressman Henry Waxman (D-LA), ranking Democrat on the Energy and Commerce Committee, who originally included the California provision in the Committee’s bipartisan Medicare SGR bill, setting the stage for its final passage. CMA must also express its deep appreciation to California's Senators Dianne Feinstein and Barbara Boxer who, for the first time in six years, were able to convince the Senate leaders to include the California reform in the Senate Medicare SGR legislation. Senator Feinstein’s leadership on the Senate side was key. And sincere thanks to House Majority Whip, Congressman Kevin McCarthy (R-Bakersfield), for his willingness to protect California’s rural physicians and include the California reform in the final SGR patch legislation. California Energy Commerce Committee members, Anna Eshoo (D-Santa Clara), Lois Capps (D-Santa Barbara) and Doris Matsui (D-Sacramento), Ways and Means Committee members Mike Thompson (D-Napa, Sonoma, Solano) and Devin Nunes (R-Tulare), and House Leader Nancy Pelosi made this issue a priority and were instrumental in moving it through their committees and the House. Contact: Elizabeth McNeil, (800) 786-4262 or emcneil@cmanet.org. Comments are closed.
