Medicare is the largest health insurer in the United States, providing coverage for 39 million people aged 65 and older and 8 million people with disabilities. Although Medicare is a national program, it adjusts fee-for-service payments according to the geographic location of a practice. At the request of Congress and the Department of Health and Human Services, the Institute of Medicine (IOM) examined ways to improve the accuracy of data sources and methods used for making the geographic adjustments in payments to providers. The IOM recommends an integrated approach that includes moving to a single source of wage and benefits data; changing to one set of payment areas and labor markets; and expanding the range of occupations included in the index calculations.
Source: National Academies Press
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