State Delays Medicaid Fee Increase

The Texas Health and Human Services Commission postponed the Medicaid primary care physician payment increase authorized under the Patient Protection and Affordable Care Act. The law requires states to increase Medicaid payments to Medicare parity for primary care services provided by pediatricians, family physicians, and general internists from Jan. 1, 2013, to Dec. 31, 2014. The federal government will pay the higher costs.

The Centers for Medicare & Medicaid Services (CMS) did not publish final rules implementing the rate increase until Nov. 1, leaving states scrambling to interpret the implementation requirements and to make the necessary system changes, said Helen Kent Davis, director of government affairs for the Texas Medical Association. By late November, it was clear that there were too many outstanding technical issues to be resolved for Texas and other states to start paying the higher rates by Jan. 1, she said.

Regardless when the change does take effect, the state will make retroactive payments for eligible services to Jan. 1 to ensure eligible primary care physicians receive two years of higher payments, Ms. Davis said.

The higher payments will apply to evaluation and management and vaccine administration codes and will benefit physicians who participate in both Medicaid fee-for-service and Medicaid HMO plans, she said. Further, the federal rule specifies that physicians who are pediatric, family medicine, or internal medicine subspecialists also will be eligible for higher payments. Payments for eligible services provided by physician assistants or advanced practice nurses also will increase if patients receive the service under physician supervision. If midlevel providers bill under their own Medicaid numbers, they will be paid 92 percent of the higher rate, the same discount that applies to their services today. Eligible physicians will be required to self-attest that they qualify for the higher payments. Details about the attestation process are not yet available.

In a related issue, TMA President Michael Speer, MD, said in a letter to the Texas congressional delegation that Congress should not reverse CMS plans for the Medicaid physician payment increase to pay for preventing drastic cuts in Medicare payments to physicians. The presidents of the Texas Academy of Family Physicians, the Texas Pediatric Society, and the American College of Physicians-Texas Chapter also signed the letter.  

Reversal of the pay hike for Medicaid primary care services is one proposal to pay for stopping the 27-percent cut in Medicare payments scheduled to take effect Jan. 1.

"We cannot turn Medicaid into a more effective delivery system until we shore up Medicaid patients' eroding access to primary care physicians and key specialists," Dr. Speer wrote. "Only 31 percent of Texas physicians now accept all new Medicaid patients, according to a recent TMA survey, and poor payment is the primary culprit. CMS recognized this when it acted to boost Medicaid payments for eligible physician services. Reversing this solution for short-term savings – even if those savings might be used to fix Medicare's glaring payment problems – will ultimately cost lives and more money."

The American Medical Association and national and state medical and specialty societies across the country, including TMA, also wrote congressional leaders to oppose the cut. "The Medicaid payment increase is an important policy that attempts to better align payment rates with cost of care for primary care physicians, thus increasing access to primary care physicians for millions of Medicaid patients," that letter said.

Action, Dec. 17, 2012

Last Updated On

December 17, 2012