Short Takes On News & Events

Most Doctors Still Waiting On Medicaid Pay Raise

By Phil Galewitz

May 14th, 2013, 3:10 PM

Five months after primary care doctors who treat Medicaid patients were supposed get a big pay raise, most physicians have yet to see it.

Only three states have implemented the pay raise — Nevada, Michigan and Massachusetts, according to the American Academy of Family Physicians.

The two-year pay hike is intended to entice more doctors to treat the millions of residents expected to enroll in Medicaid in 2014 when the federal health law expands eligibility. Critics have said the expansion of the federal-state program for the poor would accelerate the shortage of doctors who treat them.

Most states have not started offering the higher pay rates because the Obama administration did not issue the rules until November, and state officials said they didn’t have time to carry out the change and have the federal government approve the new rates.

All states have applied with the federal government to start offering the higher rates, but the Centers for Medicare & Medicaid Services has approved only seven.

“CMS remains confident that the higher payment rates ultimately will help increase access to care for Medicaid beneficiaries,” said a CMS statement.

While Medicaid fees vary by state, they are generally far below those paid by Medicare and private plans. The change means an average 73 percent average pay increase nationally, according to a 2012 study by the Kaiser Family Foundation (Kaiser Health News is an editorially independent program of the foundation.)

Earlier this year,  CMS said doctors will be able to get the higher fees retroactively to Jan. 1, when states do implement the provision. But many states have set deadlines for April and May for doctors to self-attest that they are primary care physicians in order to get the retroactive pay. Those that miss the deadline will only receive the pay raise once they fill out a form showing they are licensed as a family doctor, pediatrician or internist.

Several major physician groups, including the American Medical Association, American Academy of Pediatrics and the American Academy of Family Physicians, wrote to CMS earlier this month about their frustration with the delays. “Our organizations have grown increasingly concerned that the brief time frame which states had to implement this provision has resulted in confusion both by state employees responsible for administering the program and the physician community,” stated the letter to Cindy Mann, who runs the Medicaid program.

One overarching concern shared by our organizations is the lack of a coordinated plan to educate and communicate to eligible providers about the payment increase and steps physicians must take to participate.”

Stephen Zuckerman, senior fellow at the Urban Institute, said doctors were hesitant to sign on as a result of the pay raise given that it expires at the end of 2014, and the implementation problems won’t help.

“Because of the temporary nature of the pay raise, it was always questionable how many doctors would jump at treating Medicaid patients if they had not done in the past,” he said. “If doctors were tentative before, they still have a reason to be.”

5 Responses to “Most Doctors Still Waiting On Medicaid Pay Raise”

  1. Steven Watkins says:

    Let’s be clear: This is a temporary increase only to Medicare rates, not commercial rates. In a few states, docs will actually get a PAY CUT because their respective states already reimbursement rates in excess of Medicare. These tend to be very needy patients….45 minutes with a patient for $66.12 is hardly an enticement.

  2. Billy Wynne says:

    Just for the sake of facts, this is Medicaid (generally, low-income people) not Medicare (generally, seniors). And it is a floor, not a cap, so no one is going to get a pay cut due to this policy. It doesn’t impact commercial rates because the Federal government doesn’t regulate those.

  3. Bob Aita says:

    Steven Watkins, in addition to your mistaking Medicare as Medicaid I find it troubling that your are concerned that $66.12 for a 45 minute visit with a needy person is “hardly an enticement” to a physician.
    Your figures work out to almost $90 per hour . On a 40 hour work week basis, 50 weeks per year, that works out to more than $176,000 a year.
    Assuming a physician’s entire patient load is nothing but Medicaid participants, that’s not such a bad revenue stream and, according to Billy Wynne, that’s a base not a maximum. Serving those less fortunate and needy is a laudable effort and making $176k at the same time ain’t too shabby.

  4. Charles Elboim says:

    Please remember that the 176k number is total theoretical reimbursement, from which you must subtract rent, utilities, salaries, malpractice, record-keeping expenses, health insurance, disability insurance, state & federal taxes, retirement, and so on! The cost of a medical practice is huge, as any primary care physician can attest. And I’m a surgeon!

  5. Scott Tong says:

    To Bob Aita,

    I am shocked at your comment of how $90 dollars per hour is outstanding for a private practice doctor, considering it’s a business with employees, insurance, rent, utilities. Since overhead for doctor’s office is 65%, you think a doctor taking home $30 an hour is generous. I don’t know how she will pay off that $400,000 medical student loan…