II 

110TH CONGRESS 

2D SESSION S. 3318 

To amend title XVIII of the Social Security Act to provide for recognition 

of equality of physician work in all geographic areas and revisions to 

the practice expense geographic adjustment under the Medicare physician 

fee schedule. 

IN THE SENATE OF THE UNITED STATES 

JULY 23, 2008 

Mr. GRASSLEY introduced the following bill; which was read twice and referred 

to the Committee on Finance 

A BILL 

To amend title XVIII of the Social Security Act to provide 

for recognition of equality of physician work in all geographic areas and revisions to the practice expense geographic adjustment under the Medicare physician fee 

schedule. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Medicare Physician 

5 Payment Equity Act of 2008’’. 


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1 SEC. 2. RECOGNITION OF EQUALITY OF PHYSICIAN WORK 

2 IN ALL GEOGRAPHIC AREAS UNDER THE 

3 MEDICARE PHYSICIAN FEE SCHEDULE. 

4 Section 1848(e)(1) of the Social Security Act (42 

5 U.S.C. 1395w–4(e)(1)) is amended— 

6 (1) in subparagraph (A), in the matter pre7 ceding clause (i), by striking ‘‘subparagraphs (B)’’ 

8 through ‘‘the Secretary’’ and inserting ‘‘the suc9 ceeding provisions of this paragraph, the Secretary’’; 

10 and 

11 (2) by inserting after subparagraph (E) the fol12 lowing new subparagraph: 

13 ‘‘(F) RECOGNITION OF EQUALITY OF PHY14 SICIAN WORK IN ALL GEOGRAPHIC AREAS.—In 

15 recognition of the fact that the physician work 

16 for a service is the same in all geographic areas, 

17 and should be similarly valued under this title, 

18 for services furnished on or after January 1, 

19 2010, the geographic index for physician work 

20 under subparagraph (A)(iii) shall be 1.0 in all 

21 fee schedule areas.’’. 

22 SEC. 3. REVISIONS TO THE PRACTICE EXPENSE GEO23 GRAPHIC ADJUSTMENT UNDER THE MEDI24 CARE PHYSICIAN FEE SCHEDULE. 

25 (a) ESTABLISHMENT OF FLOOR.—Section 

26 1848(e)(1) of the Social Security Act (42 U.S.C. 1395w– 


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1 4(e)(1)) is amended by adding at the end the following 

2 new subparagraph: 

3 ‘‘(H) FLOOR AT 1.0 ON PRACTICE EXPENSE

4 GEOGRAPHIC INDEX.—After calculating the 

5 practice expense geographic index in subpara6 graph (A)(i), for purposes of payment for serv7 ices furnished in 2009, the Secretary shall in8 crease the practice expense geographic index to 

9 1.0 for any locality for which such practice ex10 pense geographic index is less than 1.0.’’. 

11 (b) MORE APPROPRIATE RECOGNITION OF PRACTICE

12 EXPENSE DIFFERENCES IN EMPLOYEE WAGES AND OF13 FICE RENTS AMONG GEOGRAPHIC AREAS.—Section 

14 1848(e)(1) of the Social Security Act (42 U.S.C. 1395w– 

15 4(e)(1)), as amended by subsection (a), is amended by 

16 adding at the end the following new subparagraph: 

17 ‘‘(I) MORE APPROPRIATE RECOGNITION OF

18 DIFFERENCES IN EMPLOYEE WAGES AND OF19 FICE RENTS AMONG AREAS.— 

20 ‘‘(i) IN GENERAL.—In recognition of 

21 the limitations on available data (as de22 scribed in clause (ii)) for use as the em23 ployee wage and office rent proxies in the 

24 practice expense geographic index de25 scribed in subparagraph (A)(i), and in 


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1 order to more appropriately reflect dif2 ferences among different fee schedule 

3 areas, for services furnished on or after 

4 January 1, 2010, such practice expense ge5 ographic index shall be an index which reflects 1 6 ⁄2 of the difference between the rel7 ative costs of employee wages and rents in 

8 each of the different fee schedule areas 

9 and the national average of such employee 

10 wages and rents. 

11 ‘‘(ii) LIMITATIONS ON AVAILABLE

12 DATA.—The limitations on available data 

13 described in this clause are the following: 

14 ‘‘(I) The need to use proxy data 

15 to reflect differences in employee 

16 wages and rents among areas. 

17 ‘‘(II) Wages for some categories 

18 of employees being determined in na19 tional markets. 

20 ‘‘(III) Physicians having to com21 pete for some employees in market 

22 areas that cross fee schedule areas. 

23 ‘‘(IV) Physicians in rural areas 

24 frequently having to locate their ofVerDate Aug 31 2005 05:03 Jul 24, 2008 Jkt 069200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\S3318.IS S3318

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1 fices close to urban areas and com2 peting with urban rent markets.’’. 

Æ 


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