Second update of the geographic practice cost index

224 Pages·1996·6.4 MB·English

by  Pope, Gregory (Gregory C.)

HEALTH ECONOMICS RESEARCH, INC.
300 FifthAvenue, 6th Floor
Waltham, MA02154
[phone]
[phone]-FAX
SECOND UPDATE OF THE
GEOGRAPHIC PRACTICE COST INDEX
Final Report
Submitted by
:
Gregory C. Pope, M.S.
Killard W. Adamache, Ph.D.
•
with
:
Health Economics Research, Inc.
300 Fifth Avenue, 6th Floor
Waltham, Massachusetts 02154
December 24, 1996
ThisreportwaspreparedunderContractNo.500-92-0020-013fromtheHealthCareFinancingAdministrationtoHealthEconomics
Research,Inc. ThehelpfulcommentsofourHCFA ProjectOfficer,BensonL.Dutton,Jr.,aswellasotherHCFAstaff,aregratefully
acknowledged. Thestatementscontainedinthisreportaresolelythoseoftheauthorsanddonotnecessarilyreflecttheviewsor
policiesoftheHealthCareFinancingAdministration. Thecontractorassumesresponsibilityfortheaccuracyandcompletenessof
theinformationcontained inthisreport.

11 1
TABLE OF CONTENTS
PAGE
EXECUTIVE SUMMARY E-l
1.0 Changes inData andMethodologyBetweenthe 1995 and 1997 GPCIs E-
2.0 1999 GPCIs and Changes inthe GeographicAdjustmentFactor
Between 1999 and 1997 E-5
INTRODUCTION
1.0 1-1
1.1 Backgroundonthe Geographic Practice CostIndex 1-1
1.1.1 Structure andRoleofthe GPCI intheMedicareFee Schedule 1-
1.1.2 Historyofthe GPCI 1-4
1.1.3 SecondUpdateofthe GPCI 1-5
1.2 Cost Shares 1-5
1.3 Fee ScheduleAreas 1-6
1.4 RelativeValueUnitWeights 1-7
1.5 BudgetNeutralityAdjustment 1-7
1.6 Overviewofthe Report 1-8
2.0 PHYSICIANWORK GPCI AND EMPLOYEE WAGE INDEX 2-1
2.1 Datato Update the Census Wage Indices Between Decennial Censuses 2-2
2.2 Empirical Analysis ofPPS Wage and BLS ES-202 Update Factors 2-8
2.2.1 PPS WageVersus ES-202 Wage Changes 2-9
2.2.2 ES-202 Wage Changes by Industry 2-12
2.3 Magnitude ofChanges Between Decennial Censuses inthe Physician
Work andEmployeeWage Indices 2-16
2.4 Conclusions and Recommendations onUpdating Census Wage Indices 2-19
2.5 1999 Versus 1997 Work GPCI andEmployeeWage Index 2-2
3.0 OFFICE RENTAL INDEX 3-1
3.1 Fiscal Year 1996 FairMarket Rents 3-1
3.2 RestrictionofCounty-Specific Rental AdjustmenttoNew York City 3-4
3.3 Final 1999 Office Rental Index 3-7
4.0 MALPRACTICE GEOGRAPHIC PRACTICE COST INDEX 4-1
4.1 Historyofthe MGPCI 4-1
4.2 Data 4-2
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TABLE OF CONTENTS
(continued)
PAGE
4.2.1 PhysicianMalpractice Insurance Premiums 4-3
4.2.2 RelativeValueUnits andAllowed Charges by Specialty 4-5
4.3 Calculationofthe Malpractice GeographicPractice Cost Index 4-7
4.4 ImpactoftheUpdated 1999 MGPCI 4-9
4.5 Conclusion 4-16
5.0 1999 VERSUS 1997 PRACTICE EXPENSE GPCI AND GEOGRAPHIC
ADJUSTMENT FACTOR
5-1
5.1 1999 Versus 1997 PracticeExpense GPCI 5-1
5.2 1999 Versus 1997 GeographicAdjustment Factor 5-4
REFERENCES
APPENDIX A
APPENDIX B
APPENDIX C
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