AMCNO responds to CMS Proposed Rule – Physician payment and GPCI calculation at issue

On behalf of our membership, the AMCNO submitted comments to the Centers for Medicare and Medicaid Services (CMS) relative to the issue of the impending Medicare payment cuts for physicians. In addition, the AMCNO sent strong comments to CMS regarding the items contained in the proposed rule relative to the geographic practice cost indices (GPCI) utilized by Medicare.

The Medicare physician fee schedule adjusts physician fees for area differences in physicians’ costs of operating a private medical practice. Three separate indices, known as geographic practice cost indices (GPCI) raise or lower Medicare fees in an area, depending on whether the area’s physician practice costs are above or below the national average. These GPCIs adjust physician fees for variations in physicians’ costs of providing care in different geographic areas. The three GPCIs correspond to the three components of a Medicare fee: physician work, practice expense, and malpractice expense.

At this time, CMS uses 89 physician payment localities among which fees are adjusted. CMS recognizes that changing demographics and local economic conditions may lead to increased variations in practice costs in certain payment locality boundaries. Currently, the state of Ohio is designated as a statewide locality. This designation was made with the support of the state medical association over ten years ago and over the strong objections of the AMCNO. The AMCNO objected due to the fact that a change to a statewide locality would impact payments to physicians in Northern Ohio since a statewide locality in Ohio clearly would not accurately account for the variations in practice costs in certain payment localities. As the regional organization representing physicians in Northern Ohio the AMCNO continues to advocate for a change in the payment localities utilized in Ohio. A copy of our letter to CMS has been sent to the Government Accounting Office and the Department of Health and Human Services. Click here for a copy of our letter - additional information on this issue will also be contained in the upcoming issue of the Northern Ohio Physician magazine. Any questions regarding this issue may be forward to E. Biddlestone at the AMCNO at 216-520-1000, ext. 100.