Medicare Economic Index


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Medicare Economic Index

A measure of (physician) practice cost inflation developed in 1975 as a way of estimating annual changes in physicians’ operating costs and earnings levels. The MEI is based on multiple factors—e.g., salaries, prices of supplies and equipment, etc.—and is used by Medicare to determine annual adjustments of physician reimbursement for services.

The Medicare Economic Index (MEI) is the baseline for each year’s payment update calculation, and used in the target calculation to determine the price component of the Sustainable Growth Rate (SGR). Payment updates are equivalent to the MEI multiplied by an “adjustment factor”, which reflects how spending compares to the SGR targets. Since 1992, the MEI has been weighed in connection with the update factor for a physician fee schedule.
References in periodicals archive ?
(2) The Medicare Payment Advisory Commission also recommended that physician productivity should be considered separately in update decisions as opposed to as a component of the Medicare Economic Index. CMS chose not to adopt this recommendation.
"The Medicare Economic Index: Its Background and Beginnings." Health Care Financing Review 3, no.
Johnson was prepping to introduce a pay-for-performance bill that would repeal the SGR and base future updates for physician payments on the Medicare Economic Index (MEI).
Johnson was prepping to introduce a pay for performance bill that would repeal the SGR and base future updates for physician payments on the Medicare Economic Index (MEI).
CMS earlier this year attempted to cushion the blow of forthcoming pay cuts by increasing the Medicare Economic Index, a component in the pay formula.
This is also the case with the HCFA skilled nursing facility (SNF) input price index (Table 11), the home health agency (HHA) input price index (Table 12), and the Medicare economic index (MEI) (Table 13), the index used to update physician payments under Medicare.
The cost of replacing the SGR with the Medicare Economic Index alone is estimated to be $292 billion through 2015, according to projections from the Medicare trustees.
In comments to the GAO, the CMS said it has taken administrative actions in the past to help physicians, such as slightly increasing the Medicare Economic Index (MEI), which helps adjust the fee schedule for inflation in medical practice costs.
In its proposed 2003 physician fee schedule, CMS announced that it would increase the Medicare Economic Index (MEI), which helps adjust the fee schedule for inflation in medical practice costs, from 2.3% to 3%.
For the PPS hospital input price index, the home health agency (HHA) input price index, and the Medicare economic index (MEI), wage growth accelerated in 1996.
3617, which would repeal the sustainable growth rate altogether and replace it with a payment increase based on the Medicare Economic Index.
Nancy Johnson (R-Conn.) that would repeal the SGR and base future updates for physician payments on the Medicare Economic Index (MEI).

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