Forget the governors: Are doctors ready for the Medicaid expansion?

February 8, 2013

Welcome to Health Reform Watch, Sarah Kliff’s regular look at how the Affordable Care Act is changing the American health-care system — and being changed by it. You can reach Sarah with questions, comments and suggestions  here. Check back every Monday, Wednesday and Friday at 2 p.m. for the latest edition.

Republican governors have plenty to worry about with the health-care law's Medicaid expansion, ranging from the political fallout for supporting a key pillar of Obamacare to the  risk of expanding an entitlement program only to face cuts down the line.

There's one other factor that also weighs heavy on their minds: If they expand Medicaid, bringing 17 million new patients into the system, will there be enough doctors to see them? It's one thing to give out new insurance cards. It's quite another to ensure that the new card guarantees access to health-care providers.

The challenge is especially vexing in Medicaid, which tends to pay providers less than its sister program for the elderly, Medicare, and private insurance. This map from the Kaiser Family Foundation compares Medicare and Medicaid reimbursement rates. In some states, Medicaid pays only 37 percent of Medicare's rates.

Those low reimbursement rates are often cited as the reason that about a third of doctors say they are not accepting new Medicaid patients. One recent study found that two-thirds of Medicaid callers had trouble securing an appointment with a specialist, compared with 11 percent of private insurance subscribers.

How do we know that low reimbursement rates are the culprit? A Health Affairs study in 2012 showed some of the best evidence for this idea yet. It found a strong correlation between states that had low reimbursement rates  and a higher number of doctors who said they were not accepting new Medicaid patients.

That same study, conducted by Sandra Decker in the  National Center for Health Statistics, also found that one-third of doctors nationwide said, in 2011, that they would not accept new patients.

This is the downside access landscape that governors are staring at when they think about expanding the Medicaid program: A program that pays lower rates, and has a not insignificant number of doctors who have ruled out new patients altogether.

The drafters of the Affordable Care Act did contemplate these challenges, and included some provisions meant to counter these exact types of access issues. While they didn't expect that they would have to woo Republicans into participating in the Medicaid expansion, these parts of the law just might do the trick.

The health-care law's big attempt at increasing Medicaid access takes on the exact same factor that we think inhibits access: Low reimbursement rates. The Affordable Care Act boosts Medicaid primary care reimbursement rates to match those paid by the Medicare program. Given that Medicaid rates tend to be really low, this works out to an average raise of 73 percent.

In the states that have been paying the lowest rates, the increase is even bigger. Here's another map from Kaiser Family Foundation that shows what the boost looks like nationwide.

This means that in a state like New Jersey, which has the lowest rate of doctors who participate in the Medicaid expansion, providers have seen their reimbursements double since the start of this year.

Does that matter on the ground, to providers? It's hard to know from most of the Medicaid research, which was conducted before the Affordable Care Act expanded Medicaid. We do have one study though, from Michigan, which suggests that most doctors do feel like they can take on more Medicaid patients than they currently see.

The Center for Health Care Research and Transformation at the University of Michigan fielded a survey of the state's doctors, to gauge whether they would be willing to take on new patients.

Michigan is among the states with lower Medicaid rates: It pays doctors about 60 percent of what Medicare does. Researchers wanted to know — even before the Supreme Court made the Medicaid expansion optional — whether the state would be ready.

"We decided we wanted to do this survey about a year ago because, like so much of health reform, this will effect doctors," said Marianne Udow-Phillips, who directs the center at the University of Michigan.

The survey actually went out to doctors after the Supreme Court decision, meaning doctors knew that the Medicaid expansion was optional.

What they found was that, perhaps surprisingly, most doctors said yes: They were ready to take on more Medicaid patients. Eighty-one percent of primary care providers said they had the capacity to accept new patients. Those doctors were evenly distributed between Michigan's rural and urban areas.

Udow-Phillips's center does not take a position on the Medicaid expansion, although she does see how the data they and others have provided did help Gov. Rick Snyder support the expansion.

"I think the facts speak for themselves," she says. "Financially, the state comes out ahead, hundreds of thousands of citizens gain insurance and we have the provider capacity." 

There are still 17 governors still weighing their decisions, though — and whether their doctors are also ready could be a big factor in whether they say yes or no.

KLIFF NOTES: Today’s top health policy reads from around the Web:

GOP Senators promise to block Obamacare subsidies for unions. "A group of 31 Republican senators asked the White House not to allow subsidies under the health-overhaul law for health insurance plans jointly run by employers and unions." Janet Adamy in the Wall Street Journal. 

In-fighting kills the Mississippi health insurance exchange.  "Federal officials said state-based marketplaces, as part of the conditions for their approval, must prove they can work with other agencies so people who apply for coverage will be directed seamlessly to private insurance or government programs such as Medicaid. Bryant, a Tea Party Republican, has made clear he would not allow that." Phil Galewitz in Kaiser Health News

 

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Sarah Kliff · February 8, 2013