Establishing a Geographic Medicare Economic Index: Some Illustrations

摘要

The report assessed the problems and prospects in developing one or more geographic indices. Data were assembled from a variety of published and unpublished sources with respect to County or State level variations in prices of goods and services believed to be correlated with the prices paid by physicians for the inputs to their practices. A modified Laspeyres price index approach was used to compute a wide variety of practice cost indices on the Medicare Part B payment area level and a MSA/non-MSA level, which was based on a simple market basket of the kinds of goods and services purchased by physicians for their practices. An index of Medicare payment levels was also created. This index was then contrasted with the various geographic practice cost estimates.