To modify the manner in which the wage index adjustment to payments under the Medicare Program to hospitals for inpatient hospital services is calculated.

May 17, 2001

Mr. KIND introduced the following bill; which was referred to the Committee on Ways and Means

To modify the manner in which the wage index adjustment to payments under the Medicare Program to hospitals for inpatient hospital services is calculated.

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

This Act may be cited as the `Medicare Equitable Payment Enhancement Act of 2001'.

SEC. 2. MODIFICATION OF CALCULATION OF MEDICARE INPATIENT HOSPITAL WAGE INDEX.

(a) IN GENERAL- Effective with respect to cost reporting periods beginning on or after October 1, 2002, in determining what proportion of operating costs of inpatient hospital services (as defined in section 1886(a)(4) of the Social Security Act (42 U.S.C. 1395ww(a)(4))) are attributable to wages and wage-related costs, the Secretary of Health and Human Services shall exclude the following cost categories:

(1) `Professional fees'.

(2) `Postal services'.

(3) Under the cost category of `All other labor intensive', the following:

(A) `Business services'.

(B) `Computer and data processing'.

(C) `Other membership organizations'.

(b) USE OF MORE RECENT DATA IN UPDATING THE WAGE INDEX- The Secretary of Health and Human Services, in updating the factor (established by the Secretary) reflecting the relative hospital wage level in the geographic area of a hospital compared to the national average hospital wage level under the second sentence of section 1886(d)(3)(E) of the Social Security Act (42 U.S.C. 1395ww(d)(3)(E)) for a fiscal year, the Secretary shall use data from the cost reports beginning during the third fiscal year that precedes the fiscal year involved.

END