On the recordJanuary 5, 2011
As we begin the 112th Congress I want to discuss one of my continuing concerns with the Medicare Program. For the last 10 years, I have served most recently as ranking member and previously as the chairman of the Senate Committee on Finance, which has jurisdiction over Medicare. During this time I have led efforts to reform the Medicare payment system and realign incentives in Medicare to promote higher quality and more efficient care. Today, I would like to address one of the flaws in the Medicare payment system: the inaccuracy of the Medicare geographic adjustment factors used for physician practice expense and the adverse impact they have on rural Medicare beneficiaries' access to care. This flaw has for many years resulted in unfairly low payments to high quality areas like my own home State of Iowa and many other rural States. Medicare payment varies from one area to another based on the geographic adjustments known as the geographic practice cost indices or GPCIs. These geographic adjustments are intended to equalize physician payment by reflecting differences in physician's practice costs. But they do not accurately represent those costs in Iowa or other rural States. They have failed to do the job. They penalize rather than equalize Medicare reimbursement in rural States and discourage physicians from practicing in areas like New Mexico, Arkansas, Missouri, and Iowa because of their unfairly low Medicare rates.
