Grassley measure would increase Medicare payment to Iowa physicians

By James Q. Lynch

The Gazette

Sen. Chuck Grassley is no fan of a public option, but an Ames neurologist sees an upside for Iowa in the congressional debate about a government-run health insurance program.

Grassley has won unanimous approval from Senate Finance Committee colleagues for a change in Medicare reimbursement that will narrow the gap between what Iowa physicians are paid for seeing Medicare patients and their actual costs. Dr. Michael Kitchell, president of the Iowa Medical Society, estimated a physician in San Francisco, for example, is paid 30 percent more than an Iowa physician for seeing a Medicare patient.

Kitchell thinks the debate about a public option has forced physicians – and politicians – in Iowa and other rural states to think about that.

“In California, where Medicare pays a physician 30 percent more than it pays us, the public option probably looks pretty good,” Kitchell said. For a physician in Iowa with a patient base of 90 percent Medicare patients, the prospects of a public option may not look as inviting.

“Here in Iowa, every hospital, every doctor loses money every time they see Medicare patients,” said Kitchell, who estimated 50 percent of his patients are on Medicare.

The prospect of a 1.45 percent increase in Medicare reimbursement next year and a 2.9 percent increase in 2012 “is something to be a little happy about,” Kitchell said. The difference would be $9 million for Iowa health-care providers and $18 million the following year, he said.

Grassley said the change is necessary to attract and retain health-care providers in rural Iowa, a situation that threatens health-care of seniors.

“It's getting harder and harder for seniors to find doctors serving in rural areas,” Grassley said. “It's a question of fairness and accuracy to fix the problem of rural physicians getting paid less for performing the same procedures than doctors in other areas.”

Under the current formula, Iowa ranks 77

^th

out of 89 Medicare payment localities and would move to 81st. The formula is based on inaccurate data, Grassley said. Employee wages, for example, are based on only a few occupations -- nurses, clerical personnel and technicians.  Office rent is based on Housing and Urban Development apartment rental data rather than commercial real estate rental rates.

Grassley also is interested in a proposal by Iowa Democratic Reps. Bruce Braley, Dave Loebsack and Leonard Boswell to change Medicare to a quality-based payment system rather than simply paying health-care providers based on the number of procedures they perform.