A bill to amend title XVIII of the Social Security Act to ensure Medicare beneficiary access to physicians, to ensure equitable reimbursement under the Medicare program for all rural States, and to eliminate sweetheart deals for frontier States.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Medicare Rural Health Care Equity 
Act of 2010''.

SEC. 2. REVISIONS TO THE PRACTICE EXPENSE GEOGRAPHIC ADJUSTMENT UNDER 
              THE MEDICARE PHYSICIAN FEE SCHEDULE.

    Effective as if included in the enactment of the Patient Protection 
and Affordable Care Act (Public Law 111-148), subparagraph (H) of 
section 1848(e)(1) of the Social Security Act (42 U.S.C. 1395w-
4(e)(1)), as added by section 3102(b) of the Patient Protection and 
Affordable Care Act, is amended to read as follows:
                    ``(H) Practice expense geographic adjustment for 
                2010 and subsequent years.--
                            ``(i) For 2010.--Subject to clause (iii), 
                        for services furnished during 2010, the 
                        employee wage and rent portions of the practice 
                        expense geographic index described in 
                        subparagraph (A)(i) shall reflect \1/2\ of the 
                        difference between the relative costs of 
                        employee wages and rents in each of the 
                        different fee schedule areas and the national 
                        average of such employee wages and rents.
                            ``(ii) For 2011.--Subject to clause (iii), 
                        for services furnished during 2011, the 
                        employee wage and rent portions of the practice 
                        expense geographic index described in 
                        subparagraph (A)(i) shall reflect \1/4\ of the 
                        difference between the relative costs of 
                        employee wages and rents in each of the 
                        different fee schedule areas and the national 
                        average of such employee wages and rents.
                            ``(iii) Hold harmless.--The practice 
                        expense portion of the geographic adjustment 
                        factor applied in a fee schedule area for 
                        services furnished in 2010 or 2011 shall not, 
                        as a result of the application of clause (i) or 
                        (ii), be reduced below the practice expense 
                        portion of the geographic adjustment factor 
                        under subparagraph (A)(i) (as calculated prior 
                        to the application of such clause (i) or (ii), 
                        respectively) for such area for such year.
                            ``(iv) Analysis.--The Secretary shall 
                        analyze current methods of establishing 
                        practice expense geographic adjustments under 
                        subparagraph (A)(i) and evaluate data that 
                        fairly and reliably establishes distinctions in 
                        the costs of operating a medical practice in 
                        the different fee schedule areas. Such analysis 
                        shall include an evaluation of the following:
                                    ``(I) The feasibility of using 
                                actual data or reliable survey data 
                                developed by medical organizations on 
                                the costs of operating a medical 
                                practice, including office rents and 
                                non-physician staff wages, in different 
                                fee schedule areas.
                                    ``(II) The office expense portion 
                                of the practice expense geographic 
                                adjustment described in subparagraph 
                                (A)(i), including the extent to which 
                                types of office expenses are determined 
                                in local markets instead of national 
                                markets.
                                    ``(III) The weights assigned to 
                                each of the categories within the 
                                practice expense geographic adjustment 
                                described in subparagraph (A)(i).
                        In conducting such analysis, the Secretary 
                        shall not take into account any data that is 
                        not actual or survey data.
                            ``(v) Revision for 2012 and subsequent 
                        years.--As a result of the analysis described 
                        in clause (iv), the Secretary shall, not later 
                        than January 1, 2012, make appropriate 
                        adjustments to the practice expense geographic 
                        adjustment described in subparagraph (A)(i) to 
                        ensure accurate geographic adjustments across 
                        fee schedule areas, including--
                                    ``(I) basing the office rents 
                                component and its weight on occupancy 
                                costs only and making weighting changes 
                                in other categories as appropriate;
                                    ``(II) ensuring that office 
                                expenses that do not vary from region 
                                to region be included in the `other' 
                                office expense category; and
                                    ``(III) considering a 
                                representative range of professional 
                                and non-professional personnel employed 
                                in a medical office based on the use of 
                                the American Community Survey data or 
                                other reliable data for wage 
                                adjustments.
                        Such adjustments shall be made without regard 
                        to adjustments made pursuant to clauses (i) and 
                        (ii) and shall be made in a budget neutral 
                        manner.
                            ``(vi) Special rule.--If the Secretary does 
                        not complete the analysis described in clause 
                        (iv) and make any adjustments the Secretary 
                        determines appropriate for 2012 or a subsequent 
                        year under clause (v), the Secretary shall 
                        apply clause (ii) for services furnished during 
                        2012 or a subsequent year in the same manner as 
                        such clause applied for services furnished 
                        during 2011.''.

SEC. 3. ELIMINATION OF SWEETHEART DEAL THAT INCREASES MEDICARE 
              REIMBURSEMENT JUST FOR FRONTIER STATES.

    Effective as if included in the enactment of the Patient Protection 
and Affordable Care Act (Public Law 111-148), section 10324 of such Act 
(and the amendments made by such section) is repealed.

Summary: Medicare Rural Health Care Equity Act of 2010 - Amends title XVIII (Medicare) of the Social Security Act, as amended by the Patient Protection and Affordable Care Act (PPACA), to revise the practice expense portion of the geographic adjustment applied in a fee schedule area for physicians' services furnished in 2010 and subsequent years. Reduces the employee wage and rent portions of the index for 2010 from 3/4 to 1/2 of the difference between the relative costs of employee wages and rents in each of the different fee schedule areas and the national average of such employee wages and rents. Reduces the same portions of the index for 2011 from 1/2 to 1/4 of such differences.

Amends PPACA to repeal specified floors for frontier states: (1) on the area wage index for hospitals; (2) on the area wage adjustment factor for hospital outpatient department services; and (3) for the practice expense index for services furnished in such states.