Noteworthy News

Medicaid Primary Care Fees to Plummet

Payments to primary care physicians who serve Medicaid patients will fall an average of 42.8 percent beginning next year when the Affordable Care Act’s two-year increase in those payments ends.

In some states – California, Florida, Illinois, New Jersey, New York, and Pennsylvania – they will decline more than 50 percent.

The cuts are even greater than the reductions in Medicare payments that Congress had to intervene to prevent because of the Medicare sustainable growth rate formula (the so-called Medicare doc fix).

The temporary fee increase was included in the Affordable Care Act to attempt to induce more primary care physicians to serve Medicaid patients in anticipation of the significant growth of Medicaid as a result of the reform law’s Medicaid expansion.  Under that law, Medicaid primary care fees were raised to the level of Medicare primary care rates for two years.

So far, 15 states plan to use their own money to prevent the dramatic reduction of Medicaid primary care payments.

The cut will be especially damaging to urban safety-net hospitals because they serve so many more Medicaid patients than the typical hospital and often are taking on more of such patients in light of the Affordable Care Act’s Medicaid expansion.

urban instituteLearn more about the upcoming Medicaid payment cut and see a state-by-state summary of the impact of the reduction on each state in the new Urban Institute report Reversing the Medicaid Fee Bump:  How Much Could Medicaid Physician Fees for Primary Care Fall in 2015?, which you can find here, on the Urban Institute’s web site.

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