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Medicaid Reimbursement Rates to Increase

Starting in January 2013, many primary care physicians will begin to see a boost in reimbursement rates for office visits performed for Medicaid patients.

Medicaid Reimbursement Rates Increasing Due to a new provision in the Affordable Care Act, providers participating in state-run Medicaid programs will receive payments equal to that of Medicare’s reimbursement fee schedule for various evaluation & management and vaccine codes.  To mitigate concerns about the Sustained Growth Rate formula’s impact on the hike, CMS has stated that the 2009 CF ($36.07) will be used along with 2013 and 2014 RVUs.  The cost difference for this hike will be funded by the Federal Government over the next two years with uncertainty looming for 2015 and beyond.

It remains to be seen how many non-participating primary care doctors will decide to enroll and shift their patient mix towards an increasing Medicaid population given the limited nature of the two-year provision.

Do you qualify for increased Medicaid reimbursements?

Here are the key factors:

  • Physician must be board-certified with a specialty of or sub-specialty in family medicine, general internal medicine or pediatric medicine
  • At least 60% of Medicaid services fall under E&M and vaccination codes that are valid for the parity calculation
  • If a mid-level provider, such as a physician assistant, is providing service, they must be supervised by a qualifying physician, as specified above


According to lawmakers, the purpose behind implementing this measure is to increase the supply of primary care service providers for Medicaid patients.  In most states, those payment rates have usually lagged behind both Medicare and commercial payers.  Additional expansion of the Medicaid program to cover a greater percentage of the uninsured is expected to increase demand for office-based physician services across the country.  It is estimated that Florida’s uninsured population will decrease anywhere from 50-55% over the next decade if Medicaid expansion initiatives are enacted.

Even with the payment boost, it is questionable that the Medicaid reimbursement rate increase will truly address the primary care shortages found in certain regions across the U.S.  According to a policy report published by the National Institute for HealthCare Reform, factors affecting primary care physicians shortages are mostly due to population density variances within each state.  For example, those states with a lower ratio of urban to rural areas often face greater shortages than smaller states with greater population densities.

In the meantime, the pay hike will be welcome by physicians across the country, although many practices will still proceed with caution given the temporary nature of the rate increase.

Check back with our blog for future updates.

Wednesday, November 28th, 2012 ACA, Reimbursement, Uncategorized
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