Perspective from The New England Journal of Medicine — Medicaid Payments and Access to Care
|Scooped by Texas Medical Association|
Ensure competitive Medicaid and CHIP payments for physicians
Physicians want to take care of Texans who rely on Medicaid coverage for their care. Unfortunately because of the red tape and bureaucratic hassles coupled with low payment rates, many physicians struggle to continue to see their Medicaid patients. (See Section 4: Promote Government Efficiency and Accountability by Reducing Medicaid Red Tape for details.)
Medicaid is a state- and federally funded health care program that provides low-income patients access to essential health care services. For every dollar Texas invests in Medicaid, the federal government contributes another $1.40. Without Medicaid, millions more Texans would be uninsured: As of June 2014, Medicaid covered nearly 3.8 million Texans. To qualify, patients must have a low income, but being poor doesn’t always mean a patient will qualify for the program. For example, low-income childless adults are not eligible in Texas even if their income meets the state’s Medicaid income requirements. Most Medicaid recipients in Texas are children, pregnant women, or disabled.
Texas allocated $56 billion in all funds to Texas Medicaid for budget years 2014-15; the state’s share was $22.1 billion, and the federal government paid $33.9 billion. While most enrollees (75 percent) are pregnant women and children, they account for only about 40 percent of the program’s costs. Seniors and patients with disabilities make up the other 25 percent of the patient population but account for 60 percent of the costs. In 2013, the Texas Legislature enacted numerous reforms to reduce total Medicaid expenditures by $961 million, including authorizing further expansion of Medicaid HMOs, improving birth outcomes, and restructuring the medical transportation program.
The Children’s Health Insurance Program (CHIP) provides health insurance to low-income children who do not qualify for Medicaid. Like Medicaid, the costs are shared between the state and federal government: In 2014, the federal government paid 70 percent of Texas’ CHIP costs. The Affordable Care Act (ACA) reauthorized CHIP through 2019 and approved funding for the program through September 2015. Pending continued funding, beginning in federal fiscal year 2016, the ACA will increase the CHIP federal matching amount another 23 percent, meaning Texas’ cost-sharing would drop from 30 percent to 7 percent. As of April 2014, some 500,000 low-income children were enrolled. To qualify, a family of four may not earn more than $47,700 (in 2014).
For physicians, Medicaid and CHIP are typically the lowest payers. They often do not cover the basic cost of providing the service. On average, Medicaid pays 73 percent of Medicare and about 50 percent of commercial insurance payments. In 2010 and 2011, the state cut already-meager physician payments another 2 percent.
Recognizing the inadequacy of Medicaid payments and the need to pay better to expand access to care, the ACA gave primary care physicians a temporary reprieve from low Medicaid rates. The act increased Medicaid payments to Medicare parity for primary care services provided by eligible physicians from Jan. 1, 2014, to Dec. 31, 2015. The federal government provided 100 percent of the funding to pay for the higher rates. CHIP services were excluded from the rate increase as were subspecialists.
Without action by Congress — or the Texas Legislature — the higher payments will soon expire. As federal action appears unlikely, Texas lawmakers should invest the necessary resources to improve appropriate and timely access to medical services for Medicaid patients not only by maintaining higher payments for primary care physicians, but also by ensuring competitive physician payment rates for subspecialists and the CHIP program.
If lawmakers cut physicians’ payments further or fail to invest in a robust physician network, millions of Medicaid recipients will have an enrollment card but fewer physicians caring for them, driving patients to use more costly emergency departments.