SEC. 1158. REVISION OF MEDICARE PAYMENT SYSTEMS TO ADDRESS GEOGRAPHIC INEQUITIES.

[a] In General- The Secretary of Health and Human Services, taking into account the recommendations made in the report under section 1157[d], shall include in the proposed rules published to implement changes to payment systems for physicians and hospitals under sections 1848[e] and 1886[d][3][E], respectively, of the Social Security Act, proposals to revise geographic adjustment factors for such payment systems for services furnished under the Medicare program. Such proposed rules shall be published in the rulemaking period immediately following submission of the report under section 1157[d].

[b] Payment Adjustments-

[1] FUNDING FOR IMPROVEMENTS- In making any changes to the geographic adjustment factors in accordance with subsection [a], the Secretary shall use funds made available for such purposes under subsection [c].

[2] ENSURING FAIRNESS- In carrying out this subsection, the Secretary shall not change payment rates to be less than they would have been had this section not been enacted.

[c] Funding- Amounts in the Medicare Improvement Fund under section 1898 of the Social Security Act [42 U.S.C. 1395iii], as amended by section 1146, shall be available to the Secretary to make changes to the geographic adjustments factors established under sections 1848[e] and 1886[d][3][E] of the Social Security Act. For such purpose, such funds shall be available for expenditure for services furnished before January 1, 2014, and shall not exceed the total amounts available under such Fund for such period. No more than one-half of such amounts shall be available for expenditure for services furnished in any one payment year.