On Wednesday, the House Energy and Commerce Committee voted unanimously to advance the Medicare Patient and Quality Improvement Act, a bill supported by Rep. Lois Capps, D-Santa Barbara, a registered nurse, that would repeal a broken Medicare provider payment formula that could cut doctor reimbursement rates by almost 30 percent next year.
The bill also includes an important provision championed by Capps that would adjust Medicare reimbursement rates so that they more accurately reflect the actual cost of practicing medicine in various localities throughout California, per the Geographic Practice Cost Index (GPCI) Fix. The fix, long supported by Capps, will solve a long-standing problem in which counties — including Santa Barbara and San Luis Obispo — are mislabeled as rural, leaving doctors seeing patients in them undercompensated for providing Medicare reimbursed procedures.
The problem dates back to 1966, when counties were either designated as “rural” or “urban.” Those designations were never changed, so doctors practicing in counties that have grown since then are being compensated at significantly lower levels than they should. There are 14 California counties — including Santa Barbara and San Luis Obispo — whose Medicare providers are being underpaid by as much as 10 percent a year, according to the California Medical Association.
“I am pleased the committee unanimously moved this bill forward,” Capps said. “It is important to everyone on the Central Coast — medical providers and the patients they care for — that we appropriately pay physicians for the services they provide. The GPCI system has been unfair for too long and I am pleased that we were able to get a fix included in this critical legislation.
"This bipartisan bill also ends an problematic SGR formula that will result in arbitrary reimbursement cuts of nearly 30 percent for Medicare providers across the country and replaces it with a system to reward the highest quality of care for all Medicare beneficiaries. In all my meetings with doctors up and down the Central Coast one message has been repeated loud and clear: fix the GPCI and the SGR. This bill would do just that.”
The GPCI Fix was part of a bill that would repeal the broken SGR formula. The SGR, established in 1999, was supposed to restrain the increase in Medicare’s annual spending on physician services. A target for each year was set, and Medicare was supposed to spend less than that amount. But the SGR formula has proven unworkable, and a bipartisan effort to reform the broken policy commenced. This bill would replace that antiquated and broken system, while preserving an enhanced fee for service, giving seniors and their medical providers certainty.
The bill calls for a 0.5 percent increase for physicians from 2014 through 2018, while continuing to support fee-for-service medicine, and encourages the formation of quality data reporting and new delivery models.
The legislation now moves to the House Ways and Means Committee.
— Chris Meagher is press secretary for Rep. Lois Capps, D-Santa Barbara.