Insurance: Sonoma, Marin to get 'urban' Medicare reimbursement

Legislation enabling health care providers, including many in the North Bay, to collect higher reimbursement rates on Medicare patients recently passed the U.S. Senate and was signed by the president, a move that will likely permit more physicians to treat Medicare patients.

Several North Bay counties changed designations from "rural" to "urban" as part of H.R. 4302, the Protecting Access to Medicare Act of 2014, led by U.S. Rep. Mike Thompson, D-St. Helena.

The fix applies to both Marin and Sonoma counties, along with 12 others: Sacramento, San Diego, Riverside, San Bernardino, Santa Cruz, Monterey, San Benito, San Luis Obispo, Santa Barbara, El Dorado, Yolo and Placer.

Currently, Medicare reimburses physicians outside hospitals according to the Geographic Practice Cost Index, an index based on cost of living, cost of providing care, cost of malpractice insurance and other provider costs. Counties in California are put into one of nine separate reimbursement localities based on the GPCI formula. Counties with similar GPCIs are supposed to be put in the same reimbursement locality.

Sonoma County, despite having a high cost of living, has been classified as a rural county.

"Because of this out-dated rural classification, physicians are being reimbursed at a level that doesn't accurately reflect the costs of providing care in that area," Rep. Thompson said. "This fix will help make sure that medical professionals in Sonoma County who care for Medicare beneficiaries are reimbursed at the appropriate, up-to-date levels."

The legislation, Rep. Thompson said, "corrects this by updating the outdated payment localities to the current Metropolitan Statistical Areas, which is the same way Medicare currently pays hospitals."***

Santa Rosa-based American AgCredit recently reported a spike in revenues related to a rush to open or renew crop-insurance policies by Jan. 31 as a result of California's drought emergency declaration, spurred in part by the ag lender's acquisition of Petaluma-based Chris Maloney Crop Insurance Services last September.

American AgCredit's new crop-insurance division was responsible for $4.8 million in income in 2013, up 45.5 percent from 2012, the company said. Earlier this year, Ms. Maloney said drought concerns compelled scores of wineries and other farm business to either open new policies or strengthen existing polices to protect against potential weather-related losses.

The acquisition represented a significant expansion into the California's and the North Bay's crop-insurance market for American AgCredit, following an earlier acquisition in 2011 of Turlock-based Fiorini & Squires Insurance Agency. The two acquired insurance agencies in California together held about $10 million in premium volume.***


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