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Hospital, Employment, and Price Indicators for the Health Care Industry: First Quarter 1999.

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KEY TRENDS

* The decline in employment in home health care services has slowed, falling 6.6 percent in the first quarter of 1999 after a fourth-quarter decline of 8.1 percent. Non-supervisory employment also declined, down 6.7 percent in the first quarter of 1999, driving a 4.7-percent decrease in this industry's implied payrolls. (Implied payrolls are calculated by multiplying the number of non-supervisory workers by their average weekly earnings. Average weekly earnings are average weekly hours times average hourly earnings.) Home health care service employment and payroll decreases began in the first quarter of 1998, following public sector actions to control Medicare spending growth and detect fraud and abuse.

* Employment in all private and government hospitals increased by 1.3 percent in the first quarter of 1999, driven by a 1.5-percent growth in private hospital employment and a 1.7-percent increase in local government hospital employment. Employment in Federal Government hospitals continued to decline.

* Inpatient days increased by 0.8 percent in the third quarter of 1998, compared with the same period of the previous year. This increase is the second in three quarters and only the second in a 6-year period. An increase of 1.2 percent in hospital admissions was tempered by a 0.4-percent decline in the adult length of stay, the 36th consecutive quarterly decline.

* Hospital Insurance (HI) Trust Fund assets rose 8.3 percent in the first quarter of 1999. Estimates in the 1999 Annual Report of the Board of Trustees of the Federal Hospital Insurance Trust Fund indicate that, given current law and trends, the Part A trust fund will be exhausted in 2015.

* Consumer Price Index (CPI) medical price growth, which appeared to have reached a trough in the fourth quarter of 1997 at 2.6 percent, increased 3.5 percent for the third consecutive quarter in the first quarter of 1999.

* Faster growth in medical prices over the past year was attributable to accelerating drug and hospital price growth.

* Producer Price Index (PPD growth for both skilled nursing facility (SNF) and home health care services fell to near historical lows in the first quarter of 1999.

HOSPITAL OCCUPANCY RATES

Reversing a second quarter decline, the adult occupancy rate again increased, rising 0.8 percentage points in the third quarter of 1998 (Figure 1). Inpatient days rose 0.8 percent from the same period of the previous year, and staffed beds decreased only 0.6 percent. The adult occupancy rate represents the ratio of the average daily hospital census (inpatient days divided by the number of days in the year) to the average number of staffed hospital beds. The adult occupancy rate has decreased about 14 percentage points over the long term, from 73.1 percent in the second quarter of 1983 to 58.7 percent in the third quarter of 1998. The number of staffed hospital beds has fallen about 18 percent, from 1,005,718 in the second quarter of 1983 to 824,630 in the third quarter of 1998. With the exception of the first and third quarters of 1998, the number of inpatient days has decreased every quarter since the first quarter of 1990. A 33.4-percent decline in inpatient days since the second quarter of 1983 has been the main reason for the long-term decline in the adult occupancy rate.

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HOSPITAL ADMISSIONS AND OUTPATIENT VISITS

Hospital admissions rose 1.2 percent in the third quarter of 1998, compared with the same period of the previous year, while outpatient visits rose more rapidly, increasing 7.7 percent (Figure 2). The pace of growth in outpatient visits picked up from the 6.4 percent posted in the second quarter of 1998 and appears to be accelerating.

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For the third quarter of 1998, operating expenses increased 4.0 percent, compared with the same period of the previous year, and hospital revenues were up 3.0 percent. The 1.0-percentage-point difference in growth rates is the largest gap between expense and revenue growth rates in more than 9 years. Inpatient revenues increased by 1.1 percent but inpatient expenses grew by 1.9 percent. Outpatient revenues grew by 7.2 percent and outpatient expenses rose by 8.0 percent. On a per utilization basis, however, the expense per inpatient admission increased by 0.7 percent, while the expense per outpatient visit increased only 0.2 percent.

MEDICARE TRUST FUND OPERATIONS

Total Medicare outlays (the sum of Part A and Part B outlays) decreased 4.3 percent in the first quarter of 1999. Although Medicare Part A outlays rose 1.0 percent, Part B outlays dropped 12.3 percent. The HI Trust Fund income grew 9.9 percent, and, by the end of the first quarter of 1999, the level of assets in the HI Trust Fund increased 8.3 percent from the same period 1 year earlier (Figure 3). This was the fourth consecutive quarterly increase in assets and was attributable to the 9.9-percent income increase coupled with only a 1.0-percent increase in outlays. A strong economy with low unemployment continued to boost HI Trust Fund income, while outlays slowed for reasons similar to those explaining lower outlays in 1998: Lower Medicare hospital updates for reimbursement rates for 1998 and 1999 under the Balanced Budget Act of 1997 and continuing efforts to combat fraud and abuse. Estimates found in the 1999 Annual Report of the Board of Trustees of the Federal Hospital Insurance Trust Fund indicate that, given current law and trends, the Part A Trust Fund will be exhausted in 2015.

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HEALTH SECTOR EMPLOYMENT AND PAYROLLS

A 1.2-percent increase in private health services employment in the first quarter of 1999 masks a second consecutive drop in nursing home employment (-0.6 percent) and a continuing decline in home health care services employment (Figure 4). Following nine quarters of deceleration, in the fourth quarter of 1998, nursing home employment growth experienced its first decline of the 1990s (-0.4 percent), compared with the same period of the previous year. The home health care employment decrease of 6.6 percent in the first quarter of 1999, however, represents a deceleration from the declines of the previous two quarters. For home health care services, the rapid employment growth of previous years began to slow after the first quarter of 1994; actual decreases began in the first quarter of 1998. These declines followed public sector actions to control Medicare spending and detect fraud and abuse. This latest quarter's home health care employment decline, along with shrinking average weekly hours worked (down 1.4 percent) caused a 4.7-percent decrease in implied payroll, well below the 3.5-percent increase in payrolls for the health sector overall. Payrolls for health industries other than home health care rose between 2.5 and 5.5 percent, while total private economy payrolls increased 5.2 percent.

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MEDICAL PRICES

Medical prices, as measured by the CPI-U (urban consumers), grew 3.5 percent between the first quarter of 1998 and the first quarter of 1999 (Figure 5). The annualized growth for each of the past two quarters had also been 3.5 percent, nearly a percentage point faster than the recent trough in medical price growth of 2.6 percent reached in the fourth quarter of 1997. By comparison, the growth in the CPI for all items less energy has remained essentially flat, at about 2.1 percent between the fourth quarter of 1997 and the first quarter of 1999. If declining energy prices over this period were included, this divergence would be even more significant. Growth in the PPI for health services has also accelerated over the past year.

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The faster growth in medical prices appears to be the result of two major factors. First, drug price growth has accelerated rapidly in the past year. Second, hospital prices also grew faster in recent quarters. This acceleration in price growth for drugs and hospital services exceeded the slowdown in growth of nursing home and home health care services prices. Each of these trends is discussed in detail in the next few sections.

PRESCRIPTION DRUG PRICES

As shown in Figure 6, growth in the CPI for prescription drugs continued its recent acceleration in the first quarter of 1999. Between the fourth quarter of 1997 and first quarter of 1999, consumer prescription drug price growth has increased from a 1.9-percent to a 5.5-percent growth rate, when compared with the same period 1 year earlier. Much of this acceleration is attributable to rapid increases in prices of several top-selling brands of prescription drugs for allergies, diabetes, acne, and arthritis.

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The PPI for ethical (prescription) preparations shows a much faster acceleration in growth than the CPI over the past year. The large magnitude of the acceleration can be traced specifically to large increases in psychotherapeutic drug prices in the first half of 1998 because of sampling variability. However, even excluding psychotherapeutics, the PPI for prescription drugs still increased in the 5- to 6-percent range for 1998, compared with approximately 3 percent for 1997. Given the unusually large increase in this index for 1998, overall PPI prescription drug price growth should continue to decelerate in 1999 until it reaches a more stable level.

HOSPITAL SERVICES, WAGES, AND PRICES

Both the producer and consumer prices for hospital services accelerated in the first quarter of 1999, continuing the recent trend. For each of these indexes, the acceleration has been in both inpatient and outpatient price growth.

An analysis of average hourly earnings (AHE) for private hospital workers provides some insight into why output prices (those measured by the CPI and PPI) are increasing faster in current quarters. As shown in Figure 7, growth in the AHE for private hospital workers has increased from 2.8 percent in the second quarter of 1998 to 3.5 percent in the first quarter of 1999. The Employment Cost Index (ECI) for hospital workers (part of the occupational wage blend used in the HCFA PPS [prospective payment system] Hospital Input Price Index) has also exhibited a similar pattern over this period. The deceleration in the HCFA PPS Hospital Input Price Index over this period is attributable in part to the slowdown in growth of the PPI for prescription drugs following the tremendous increases of 1998, as described in the previous section.

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NURSING HOME SERVICES WAGES AND PRICES

Unlike that for hospitals, nursing home price growth has been constant or decelerating for the past four quarters. As Figure 8 shows, this seems to reflect the decelerating growth of hourly earnings in nursing homes and the relatively constant growth of input prices as measured by the HCFA SNF input price index. Standard & Poor's DRI projects the HCFA SNF input price index to continue to grow at similar rates over the next few quarters, despite the deceleration in AHE. This is because the HCFA SNF input price index reflects a constant skill mix of workers by using the ECI. The deceleration in the AHE for nursing homes (which does not hold skill mix constant) implies a shift to less skilled, lower paid workers. Part of this may be the result of the new PPS for Medicare SNF services mandated by the Balanced Budget Act (BBA) of 1997. It has been claimed by the industry that the payment system is forcing nursing homes to turn away more complex cases because the payment rates do not reflect the costs of providing these services (Hilzenroth, 1999). Growth in the public sector PPI for nursing homes is now at its lowest point since its introduction, decelerating from 4.7-percent annual growth in the fourth quarter of 1998 to 3.9 percent in the first quarter of 1999.

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HOME HEALTH CARE SERVICES, WAGES, AND PRICES

The BBA, as well as Medicare fraud and abuse initiatives, appear to have had a significant impact on home health wages and prices. The significance is caused by Medicare's large portion of total home health expenditures. Although input cost growth has remained stable over the past four quarters, home health care prices, as measured by the PPI, have decelerated from 2.9 percent in the second quarter of 1998 to 0.3 in the first quarter of 1999 (Figure 9). The Medicare portion of this index has decelerated from 2.3 to -0.6 percent over this same period. Yet an analysis of hourly earnings for home health care workers shows a dramatic acceleration in growth. Because payrolls and employment have declined dramatically in home health care agencies (Figure 4), the implication is that lower skill positions are being eliminated, causing a higher average hourly wage that is accelerating.

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Overall, the deceleration in price growth and the declines in employment seem to support reports that many home health agencies have cut back on services not covered by Medicare or have closed or merged with other agencies in response to changes in Medicare policies and payments (U.S. General Accounting Office, 1998, 1999). With a PPS scheduled to be implemented on October 1, 2000, the industry may continue to be transformed over the next year.

BACKGROUND INFORMATION ON DATA SOURCES AND METHODS

Community Hospital Statistics

Since 1963, the American Hospital Association (AHA), in cooperation with member hospitals, has been collecting data on the operation of community hospitals through its National Hospital Panel Survey. Community hospitals, which comprised more than 80 percent of all hospital facilities in the United States in 1997, include all non-Federal, short-term general, and other special hospitals open to the public. They exclude hospital units of institutions; psychiatric facilities; tuberculosis, other respiratory, and chronic disease hospitals; institutions for the mentally retarded; and alcohol and chemical-dependency hospitals.

The survey samples approximately one-third of all U.S. community hospitals. The sample is designed to produce estimates of community hospital indicators by bed size and region (American Hospital Association, 1963-98). In Tables 1 and 2, statistics covering expenses, utilization, beds, and personnel depict trends in the operation of community hospitals annually for 1994 to 1997 and quarterly from 1995 through the third quarter 1998, after which data collection was discontinued.

For purposes of national health expenditures (NHE), survey statistics on revenues are analyzed in estimating the growth in the largest component of health care costs--community hospital expenditures. This one segment of NHE accounted for 30 percent of all health spending in 1997 (Braden et al., 1998). The survey also identifies important factors influencing expenditure growth patterns, such as changes in the number of beds in operation, number of admissions, length of stay, use of outpatient facilities, and number of surgeries.

Medicare Trust Fund Operations

Separate trust funds finance the operations of the two parts of the Medicare program (Table 3). The HI program, or Medicare Part A, helps pay for inpatient hospital, home health, SNF, and hospice care for the aged and disabled. The HI program is financed primarily by payroll taxes paid by workers and employers. The taxes paid each year are used mainly to pay benefits for current beneficiaries. The Supplementary Medical Insurance (SMD program, or Medicare Part B, pays for physician, outpatient hospital, home health, and other services for the aged and disabled. The SMI program is financed primarily by transfers from the general fund of the U.S. Treasury and by monthly premiums paid by beneficiaries. For both Medicare programs, income not currently needed to pay benefits and related expenses is held in the HI and SMI trust funds and invested in U.S. Treasury securities (Board of Trustees of the Federal Hospital Insurance Trust Fund, 1999; Board of Trustees of the Federal Supplementary Medical Insurance Trust Fund, 1999).

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Data on the financial operations of the Medicare trust funds, the HI Trust Fund and the SMI Trust Fund, are available from two sources. The monthly statistics on trust fund operations are published in the Monthly Treasury Statement of Receipts and Outlays of the United States Government, Table 8: Trust Fund Impact on Budget Results and Investment Holding (U.S. Department of the Treasury, 1998). The 1999 annual reports of the HI and SMI trust funds (Board of Trustees of the Federal Hospital Insurance Trust Fund, 1999; Board of Trustees of the Federal Supplementary Medical Insurance Trust Fund, 1999) contain a detailed accounting of all financial operations for the prior fiscal year. The reports also contain actuarial analysis of the expected operations of the trust funds in future years and analysis of the actuarial status of the funds.

Private Health Sector: Employment, Hours, and Earnings

The Bureau of Labor Statistics (BLS) collects monthly information on employment for all workers, and employment, earnings, and work hours for non-supervisory workers in a sample of approximately 305,000 establishments. Data are collected through cooperative agreements with State agencies that also use this information to create State and local area statistics. The survey is designed to collect industry-specific information on wage and salary jobs in non-agricultural industries. It excludes statistics on self-employed persons and on those employed in the military (U.S. Department of Labor, 1998a).

Employment in this survey is defined as number of jobs. Persons holding multiple jobs would be counted multiple times. Approximately 5 percent of the population holds more than one job at any one time. (Other surveys that are household-based, such as the Current Population Survey [CPS], also record employment. In the CPS, however, each person's employment status is counted only once, as either employed, unemployed, or not in the labor force, which includes discouraged workers.) Once each year, monthly establishment-based employment statistics are adjusted to benchmarks created from annual establishment census information, resulting in revisions to previously published employment estimates. Tables 4, 5, and 6 present statistics on employment, non-supervisory employment, average weekly hours, and average hourly earnings for the private non-farm business sector and industries in health services.

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National Economic Indicators

National economic indicators provide a context for understanding health-specific indicators and how change in the health sector relates to change in the economy as a whole. Table 7 presents national indicators of output and inflation.

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Gross domestic product (GDP) measures the output of the U.S. economy as the market value of goods and services produced within the geographic boundaries of the United States by U.S. or foreign citizens or companies. Constant dollar or "real" GDP removes the effects of price changes from the valuation of goods and services produced, so that the growth of real GDP reflects changes in the "physical quantity" of the output of the economy. In the most recent comprehensive revision of the National Income and Product Accounts, the method for removing the effects of price changes was altered. The G DP estimates are now deflated using "chain-weighted" price indexes. This method replaces the previous fixed-weight method of deflating the GDP estimates (U.S. Department of Commerce, 1996, 1998).

PRICES

Consumer Price Indexes

BLS publishes monthly information on changes in prices paid by consumers for a fixed market basket of goods and services. Tables 7, 8, and 9 present information on the all-urban CPI that measures changes in prices faced by 87 percent of the non-institutionalized U.S. population. The more restrictive wage-earner CPI gauges prices faced by wage earners and clerical workers. These workers account for approximately 32 percent of the non-institutionalized population (U.S. Department of Labor, 1998b).

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The index reflects changes in prices charged for the same quality and quantity of goods or services purchased in the base period. For most items, the base period of 1982-1984 is used to define the share of consumer expenditures purchasing specific services and products. Those shares or weights remain constant in all years, even though consumption patterns of the household may change over time. This type of index is called a fixed-weight or Laspeyres index.

CPIs for health care goods and services depict list price changes for out-of-pocket expenditures. The CPI for medical care services also includes an indirect measure of price change for health insurance coverage purchased directly by consumers. The composite CPI for medical care weights together product-specific or service-specific CPIs in proportion to household out-of-pocket expenditures for these items. In addition, some medical care sector indexes measure changes in list or charged prices, rather than in prices actually received by providers after discounts are deducted. In several health care areas, received or transaction prices are difficult to capture, although BLS is making advances in this area.

In the NHE, a combination of CPIs for selected medical care items, input price indexes for nursing homes, and the PPI for hospitals are used as measures of inflation for the health industry. The indexes are used to develop a chain-weighted price index for personal health care to depict price changes - affecting the entire health care industry more accurately than does the overall CPI medical care index (Levit et al., 1998).

Producer Price Indexes

BLS produces monthly information on average changes in selling prices received by domestic producers for their output These prices are presented in Tables 7, 8, and 9 as the PPI. The index is designed to measure transaction prices and is different from the CPI, which in some cases measures list or full-charge prices. The PPI is a fixed-weight or Laspeyres index, with base-period weights determined by values of receipts. The base period varies among series.

The PPI consists of indexes in several major classification structures, including the industry and commodity classifications that are included in the Health Care Indicators. The PPI by industry classification measures price changes received for the industry's output sold outside the industry. PPI changes for an industry are determined by price changes for products primarily made by establishments in that industry. The industry into which an establishment is classified is determined by those products accounting for the largest share of its total value of shipments. The PPI by commodity classification measures price changes of the end product (end use or material composition). The classification system for PPI commodity groups is unique to the PPI and is divided into 15 major commodity groupings.

Although PPIs for medical commodities have existed for many years, PPIs for health service industries are relatively new. Most index series began in 1994, and the index series for the composite health services industry does not begin until December 1994. However, the PPI for hospitals began in December 1992, providing enough data for a useful time series. The PPI for hospitals is a measure of transaction prices or net prices received by the producer from out-of-pocket, Medicare, Medicaid, and private third-party payer sources. The PPI for hospitals should not be compared with the CPI for hospital and related services. Although other PPI and CPI series are somewhat comparable (for example, the PPI-Offices and Clinics of Doctors of Medicine and the CPI-Physicians' Services), the PPI and CPI for hospitals have important differences in survey scope and methodology. The PPI for hospitals measures price changes for the entire treatment path, measures net transaction price, includes Medicare and Medicaid, samples both urban and rural hospitals, and reflects total hospital revenue from all sources in its index weights. On the other hand, the CPI for hospitals measures price changes for a discrete sample of hospital services singly, measures published charges, excludes Medicare and Medicaid, samples only urban hospitals, and reflects only consumer out-of-pocket expenses and household health insurance premium payments in its index weights. These differences make a direct comparison between the PPI and CPI hospital services indexes inappropriate.

The PPI for the health services industry is available by detailed industry groupings. For example, general medical and surgical hospitals consist of inpatient and outpatient treatments, which in turn consist of Medicare, Medicaid, and all other patients. These patient categories consist of more detail, such as diagnosis-related groups (DRGs) for Medicare. Although most of the data used to measure PPI price changes for health services are collected through a sample, there are specific instances where data are collected from both a sample and from price changes in Federal regulation. This is the case for Medicare hospital inpatient services and Medicare offices and clinics of doctors of medicine. The producer price changes in Medicare hospital inpatient services are computed from a combination of a national sample of DRGs in hospitals, DRG relative weights from the PPS final rules published in the current and historical year, and other adjustments. The producer price changes in Medicare offices of doctors of medicine are computed from a combination of a geographic area sample of payments under the HCFA Common Procedure Coding System (HCPCS), HCPCS updates from the November 2, 1998, Federal Register, and other adjustments. Because of different methodologies, these two Medicare PPIs are not comparable to the national updates computed by HCFA and published in the Federal Register.

Input Price Indexes

In 1979, HCFA developed the Medicare Hospital Input Price Index (hospital market basket), which was designed to measure the pure price changes associated with expenditure changes for hospital services. In the early 1980s, the SNF and Home Health Agency (HHA) Input Price Indexes, often referred to as "market baskets," were developed to price a consistent set of goods and services over time. Also in the early 1980s, the original Medicare Hospital Input Price Index was revised for use in updating payment rates for routine costs of Medicare inpatient services. All of these indexes have played an important role in helping to set Medicare payment percent increases and in understanding the contribution of input price increases to growing health expenditures.

The Input Price Indexes, or market baskets, are Laspeyres or fixed-weight indexes that are constructed in two steps. First, a base period is selected. For example, for the PPS Hospital Input Price Index, the base period is 1992. Cost categories, such as food, fuel, and labor, are identified and their 1992 expenditure amounts determined. The proportion or share of total expenditures included in specific spending categories is calculated. These proportions are called cost or expenditure weights. There are 26 expenditure categories in the 1992-based PPS Hospital Input Price Index.

Second, a price proxy is selected to match each expenditure category. Its purpose is to measure the rate of price increases of the goods or services in that category. The price proxy index for each spending category is multiplied by the expenditure weight for the category. The sum of these products (weights multiplied by the price index) over all cost categories yields the composite Input Price Index for any given time period, usually a fiscal year or a calendar year. The percent change in the Input Price Index is an estimate of price change over time for a fixed quantity of goods and services purchased by a provider.

The Input Price Indexes are estimated on a historical basis and forecast for several years. The HCFA-chosen price proxies are forecast under contract with Standard and Poor's DRI. Following every calendar year quarter, in March, June, September, and December, DRI updates its macroeconomic forecasts of wages and prices based on updated historical information and revised forecast assumptions. Some of the data in Tables 10-12 are forecast and are expected to change as more recent historical data become available and subsequent quarterly forecasts are revised. The methodology and price proxy definitions used in the Input Price Indexes are described in the Federal Register notices that accompany the revisions of the PPS Hospital, HHA, and PPS SNF payment updates. A description of the current structure of the PPS Input Price Index is in the August 29, 1997, Federal Register, and the most recent PPS hospital update for payment rates was published in the July 31, 1998, Federal Register. The latest HHA regulatory Input Price Index was published in the August 11, 1998, Federal Register. The latest SNF input price index was published in the May 12, 1998, Federal Register.

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Periodically, the Input Price Indexes are revised to a new base year so that cost weights will reflect changes in the mix of goods and services that are purchased. Each revision allows for new base weights, a new base year, and changes to certain price variables used for price proxies.

Each Input Price Index is presented in a table with both an index level and a four-quarter moving-average percent change. The Hospital Input Price Index for PPS is in Table 10, the SNF Input Price Index is in Table 11, and the HHA Input Price Index is in Table 12.

Medicare Economic Index

In 1972, Congress mandated the development of the Medicare Economic Index (MEI) to measure the changes in costs of physicians' time and operating expenses. The input price change measured by the MEI is considered in connection with the update factor for the Medicare Part B physician fee schedule under the Resource-Based Relative Value Scale (RBRVS, November 22, 1996, Federal Register) or is used as an advisory indicator by Congress in updating the fee schedule. The MEI is a fixed-weighted sum of annual price changes for various inputs needed to produce physicians' services with an offset for productivity increases. Like a traditional Laspeyres index, the MEI is constructed in two steps. First, a base period is selected (1996 for the MEI), cost categories are identified, and the 1996 expenditure shares by cost category are determined. Second, price proxies are selected to match each relative expenditure category. These proxies are weighted by the category weight determined from expenditure amounts and summed to produce the composite MEI. Unlike a traditional Laspeyres index, the compensation portion of the MEI is adjusted for productivity, so economywide productivity and physician-practice productivity are not both included in the update, resulting in a double counting of productivity.

Forecasts of the MEI are made periodically throughout the fiscal year by Standard & Poor's DRI for HCFA using several different sets of economic assumptions. Standard & Poor's DRI produces four main forecasts of the MEI: (1) a Presidential budget forecast in December; (2) the Mid-session Review in June, based on assumptions for the Federal budget exercises; (3) the Medicare Trustees' Report forecast in February, based on assumptions by the Medicare Trustees; and (4) the Medicare Premium Promul-gation forecast in August, based on baseline assumptions by Standard & Poor's DRI. Standard & Poor's DRI also produces forecasts of the MEI using their own economic assumptions forecast. The forecasts based on Standard & Poor's DRI assumptions are presented in Health Care Indicators. Much of the forecast data changes as more recent historical data become available and the assumptions change.

The methodology, weights, and price-proxy definitions used in the MEI are described in the November 2, 1998, Federal Register. The MEI data are presented in Table 13 as index levels and four-quarter moving-average percent changes.

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REFERENCES

American Hospital Association: Hospital Statistics, 1995-96 Edition. Chicago. 1996.

American Hospital Association: National Hospital Panel Survey. Unpublished. Chicago. 1963-98.

Board of Trustees of the Federal Hospital Insurance Trust Fund: 1999 Annual Report of the Board of Trustees of the Federal Hospital Insurance Trust Fund. Washington, DC. March 30, 1999.

Board of Trustees of the Federal Supplementary Medical Insurance Trust Fund: 1999 Annual Report of the Board of Trustees of the Federal Supplementary Medical Insurance Trust Fund. Washington, DC. March 30, 1999.

Braden, B.R., Cowan, C.A., Lazenby, H.C., et al.: National Health Expenditures, 1997. Health Care Financing Review 20(1):83-126, Fall 1998.

Federal Register. Medicare Program; Revisions to Payment Policies and Adjustments to the Relative Value Units Under the Physician Fee Schedule for the Calendar Year 1999; Final Rule and Notice. Vol. 63, No. 211, 58845-58849. Office of the Federal Register, National Archives and Records Administration. Washington, DC. U.S. Government Printing Office, November 2, 1998.

Federal Register. Medicare Program; Schedules of Per-Visit and Per-Beneficiary Limitations on Home Health Agency Costs for Cost Reporting Periods Beginning On or After October 1, 1998; Notice. Vol. 63, No, 154. 42922. Office of the Federal Register, National Archives and Records Administration. Washington, DC. U.S. Government Printing Office, August 11, 1998.

Federal Register. Medicare Program: Changes to the Hospital Inpatient Prospective Payment Systems and Fiscal Year 1999 Rates; Final Rule. Vol. 63, No. 147, 41006. Office of the Federal Register, National Archives and Records Administration. Washington, DC. U.S. Government Printing Office, July 31, 1998.

Federal Register. Medicare Program: Prospective Payment System and Consolidated Billing for Skilled Nursing Facilities; Final Rule. Vol. 63, No. 91, 26291. Office of the Federal Register, National Archives and Records Administration. Washington, DC. U.S. Government Printing Office, May 12, 1998.

Federal Register. Medicare Program; Changes to the Inpatient Hospital Prospective Payment Systems and Fiscal Year 1998 Rates; Final Rule. Vol. 62, No. 168, 45993. Office of the Federal Register, National Archives and Records Administration. Washington, DC. U.S. Government Printing Office, August 29, 1997.

Federal Register. Medicare Program; Revisions to Payment Policies and Five-Year Review of and Adjustments to the Relative Value Unites, Final, and Physician Fee Schedule Update for Calendar Year 1997 and Physician Volume Performance Standard Rates of Increase for Federal Fiscal Year 1997; Notice. Vol. 61, No. 227, 59717-59724. Office of the Federal Register, National Archives and Records Administration. Washington, DC. U.S. Government Printing Office, November 22, 1996.

Federal Register. Medicare Program; Schedules of Limits of Home Health Agency Cost per Visit for Cost Reporting Periods Beginning on or After July 1, 1996. Vol. 61, No. 127, 34347-34350. Office of the Federal Register, National Archives and Records Administration. Washington, DC. U.S. Government Printing Office, July 1, 1996.

Federal Register. Medicare Program; Schedule of Limits for Skilled Nursing Facility Inpatient Routine Service Costs. Vol. 59, No.4, 762-767. Office of the Federal Register, National Archives and Records Administration. Washington, DC. U.S. Government Printing Office, June 6, 1994.

Federal Register. Medicare Program; Revision of the Medicare Economic Index; Final rule. Vol. 57, No. 228, 55896-56230. Office of the Federal Register, National Archives and Records Administration. Washington, DC. U.S. Government Printing Office, November 25, 1992.

Federal Register. Medicare Program; Schedules of Limits of Skilled Nursing Facility Inpatient Routine Service Costs; Final rule. Vol. 57, No. 129, 4617% 48187. Office of the Federal Register, National Archives and Records Administration. Washington, DC. U.S. Government Printing Office, October 7, 1992.

Hilzenroth, D.S.: Nursing Homes Shun Some Medicare Patients. Washington Post. P. Al. June 6, 1999.

Levit, K., Cowan, C., Braden, B., et al.: National Health Expenditures in 1997: More Slow Growth. Health Affairs 17(6), November/December 1998.

U.S. Department of Commerce: National Income and Product Accounts. Survey of Current Business. Vol. 78, No. 9. Bureau of Economic Analysis. Washington, DC. U.S. Government Printing Office, September 1998.

U.S. Department of Commerce: Improved Estimates of the National Income and Product Accounts for 1959-1995: Results of the Comprehensive Revision. Survey of Current Business. Vol. 76, No.1/2 Bureau of Economic Analysis. Washington, DC. U.S. Government Printing Office, January/February 1996.

U.S. Department of Labor: Employment and Earnings. Vol. 45, No. 9. Bureau of Labor Statistics. Washington, DC. U.S. Government Printing Office, September 1998a.

U.S. Department of Labor: Monthly Labor Review. Vol. 121, No. 9. Bureau of Labor Statistics. Washington, DC. U.S. Government Printing Office, September 1998b.

U.S. Department of the Treasury: Monthly Treasury Statement of Receipts and Outlays of the United States Government. Monthly Reports, January 1991 September 1998. Financial Management Service. Washington, DC. U.S. Government Printing Office, October 1998.

U.S. General Accounting Office: Medicare Home Health Benefit: Impact of Interim Payment System and Agency Closures on Access to Services. HEHS-98-238. Washington, DC. September 9, 1998.

U.S. General Accounting Office: Medicare Home Health Agencies: Closures Continue, with Little Evidence Beneficiary Access Is Impaired. HEHS-99-120. Washington, DC. May 26, 1999.

For inquiries concerning market basket data, contact Stephen K. Heffler at (410) 786-1211 or Mary Lee Seifert at (410) 786-0030. For all other inquiries, contact Carolyn S. Donham at (410) 786-7947.

Reprint Requests: Mary Lee Seifert, Office of Strategic Planning, Health Care Financing Administration, 7500 Security Boulevard, N3-02-02, Baltimore, MD 21244-1850. E-mail: mseifert@hcfa.gov

The authors are with the Office of the Actuary, Health Care Financing Administration (HCFA). The views expressed are those of the authors and do not necessarily reflect those of HCFA.
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Author:Seifert, Mary Lee; Heffler, Stephen K.; Donham, Carolyn S.
Publication:Health Care Financing Review
Date:Sep 22, 1999
Words:6077
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