We lined the key factors of the 2025 Medicare Doctor Price Schedule (MPFS) Proposed Rule when it got here out in July, however whereas we’re ready for the Last Rule to be revealed later within the 12 months let’s take a look at one other provision within the MPFS that we’ve been watching – the locality-specific cost adjustment referred to as the Geographic Observe Price Index (GPCI).
The GPCI is comprised of values associated to observe bills, malpractice insurance coverage, and the price of labor (the work worth), which act to extend or lower the usual (nationwide) Medicare cost as a way to alter for variations in the price of residing throughout the nation. Medicare computes a composite of those components known as the Geographic Adjustment Issue (GAF) that enables us to investigate the affect of the GPCI changes for every cost locality. The GAF ranges from 0.893 in Arkansas to 1.271 in Alaska, which implies practices in Arkansas are paid 10.7% lower than the nationwide price and practices in Alaska are paid 27.1% greater than the nationwide price.
Of the 109 cost localities within the Medicare system, 51 will obtain a destructive adjustment whereas 58 will see no adjustment – no locality can have a cost enhance resulting from geographic value components. The desk under reveals these localities the place the GAF might be greater than 1% decrease in 2025 than it was in 2024. Localities not listed right here will see a lower of lower than 1%, or no change to their GAF for 2025.
| Locality Title | Locality Quantity | 2024 GAF | 2025 GAF | P.c Change |
|---|---|---|---|---|
| MISSISSIPPI | 00 | 0.923 | 0.898 | -2.7% |
| ARKANSAS | 13 | 0.916 | 0.893 | -2.5% |
| REST OF MISSOURI | 99 | 0.935 | 0.913 | -2.4% |
| IDAHO | 00 | 0.936 | 0.914 | -2.4% |
| WEST VIRGINIA | 16 | 0.951 | 0.931 | -2.1% |
| KENTUCKY | 00 | 0.940 | 0.921 | -2% |
| MAINE | 99 | 0.946 | 0.927 | -2% |
| UTAH | 09 | 0.967 | 0.948 | -2% |
| KANSAS | 00 | 0.938 | 0.920 | -1.9% |
| TENNESSEE | 35 | 0.933 | 0.916 | -1.8% |
| IOWA | 00 | 0.938 | 0.921 | -1.8% |
| OKLAHOMA | 00 | 0.942 | 0.925 | -1.8% |
| LOUISIANA | 99 | 0.945 | 0.928 | -1.8% |
| MONTANA | 01 | 0.999 | 0.981 | -1.8% |
| GEORGIA | 99 | 0.952 | 0.936 | -1.7% |
| NEBRASKA | 00 | 0.933 | 0.919 | -1.5% |
| INDIANA | 00 | 0.943 | 0.929 | -1.5% |
| SOUTH CAROLINA | 01 | 0.953 | 0.939 | -1.5% |
| FLORIDA | 99 | 0.992 | 0.977 | -1.5% |
| ILLINOIS | 99 | 0.976 | 0.962 | -1.4% |
| VERMONT | 50 | 0.977 | 0.963 | -1.4% |
| MICHIGAN | 99 | 0.967 | 0.954 | -1.3% |
| SOUTH DAKOTA | 02 | 0.974 | 0.961 | -1.3% |
| WYOMING | 21 | 0.989 | 0.976 | -1.3% |
| ALABAMA | 00 | 0.923 | 0.912 | -1.2% |
| NEW MEXICO | 05 | 0.965 | 0.953 | -1.2% |
| NEW ORLEANS | 01 | 0.977 | 0.966 | -1.1% |
| OREGON | 99 | 0.979 | 0.968 | -1.1% |
| NORTH DAKOTA | 01 | 0.980 | 0.969 | -1.1% |
| FORT LAUDERDALE | 03 | 1.031 | 1.020 | -1.1% |
| ARIZONA | 00 | 0.983 | 0.973 | -1% |
| MAINE | 03 | 0.991 | 0.981 | -1% |
| EAST ST. LOUIS | 12 | 0.996 | 0.986 | -1% |
The worst case is for practices in Mississippi the place a 2.7% GAF discount will affect them along with the two.8% lower that every one practices nationwide will expertise, for a complete of a 5.5% lower within the Medicare cost price for 2025.
It’s potential that Congressional motion will mitigate among the of this lower, because it did final 12 months. It took two short-term appropriations payments to stave off related geographic cuts that saved the GPCI Work Flooring at 1.0, the identical because it was in 2023. Lastly, in March the Consolidated Appropriations Act, 2024 revised the general lower from 3.37% to 1.77% and additional sustained the GPCI Work Flooring at 1.0 for the remainder of the 12 months. In Mississippi, the 2024 cost price would have been 8.5% decrease than it was in 2023 with no Congressional motion, but it surely turned a 4.8% lower slightly than 8.5%. There isn’t a assure that related motion will happen for 2025.
We’ll proceed to watch adjustments within the Medicare cost price, which additionally influences industrial payers over the long run, and we are going to present a whole assessment of the Medicare Doctor Price Schedule for 2025 when the ultimate rule is launched.
Sandy Coffta is vice chairman of shopper providers at Healthcare Administrative Companions.
The feedback and observations expressed are these of the creator and don’t essentially mirror the opinions of AuntMinnie.com.
