Bill Would Keep Medicaid Raise for Primary Care Through 2016

Robert Lowes

On July 30, 2 senators introduced a bill that would extend a Medicaid raise for primary-care physicians another 2 years through 2016 and make more clinicians eligible for the extra money.

Given that the temporary pay hike was authorized by the Affordable Care Act (ACA), the bill's prospects are cloudy in the House, controlled by Republicans who want to junk the healthcare reform law, even if the Senate were to pass it.

The ACA allocated funds to boost historically paltry Medicaid rates to Medicare levels in 2013 and 2014 for evaluation and management (E/M) services and vaccine administration. The Kaiser Family Foundation (KFF) estimated in 2012 that Medicaid rates for those services would increase on average by 73%. Physicians eligible for the raise are family physicians, general internists, pediatricians, and subspecialists related to these fields, such as pediatric cardiologists.

The drafters of the ACA hoped that the higher rates would entice more physicians to accept Medicaid patients just as millions more individuals and families became eligible for coverage under the law. Twenty-seven states and Washington, DC, are participating in Medicaid expansion, and the rest have opted out so far, just as the Supreme Court said they could in its landmark 2012 ruling on the ACA. The Medicaid raise applies in all states regardless of expansion status.

The federal money that makes the higher rates possible is set to run out at the end of this year, but state Medicaid programs theoretically could make up the difference. Medicaid is jointly funded by federal and state governments, with Uncle Sam providing the lion's share. However, only 6 states — Alabama, Colorado, Iowa, Maryland, Mississippi, and New Mexico — and Washington, DC, intend to spend their own money to maintain Medicaid-Medicare parity, according to a story published by Kaiser Health News. The issue is a moot point for Alaska and North Dakota, which have footed the raise themselves since before 2013. For the remaining 42 states, Medicaid rates for E/M services and vaccine administration will revert to pre-2013 levels, according to Kaiser Health News.

The bill introduced by Sen. Sherrod Brown (D-OH) and Sen. Patty Murray (D-WA) would preserve Medicaid-Medicare parity for primary care physicians across the country through 2015 and 2016. "Doctors treating women, children, and families should receive the same treatment as their peers treating Medicare seniors," said Brown in a joint news release.

Obstetrician-gynecologists, nurse midwives, nurse practitioners, and physician assistants also would become eligible for the higher Medicaid rates under the bill, called the Ensuring Access to Primary Care for Women & Children Act.

President Barack Obama espoused a similar idea when he released his proposed budget for fiscal 2015 in March. Besides handing out the Medicaid raise for 1 more year, the administration wants to give it to nurse practitioners and physician assistants — but not obstetrician-gynecologists — as well. The proposed budget puts the 10-year cost of the 1-year extension at $5.4 billion.

Even if congressional Republicans and Democrats rally around the idea of prolonging the raise, or making it permanent, they'll still face the challenge of how to offset the cost with either a spending cut elsewhere in the budget or higher revenue. Disagreement over a "pay-for" for a recent plan to repeal Medicare's sustainable growth rate formula for setting physician pay killed what otherwise would have been a bipartisan breakthrough.

A bevy of medical societies have endorsed the Brown-Murray bill, including the American Academy of Family Physicians, the American Academy of Pediatrics, the American College of Physicians, and the American Osteopathic Association.