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January 27, 2014

Pay hike lures more CT docs to join Medicaid

Kate McEvoy, director of health services, DSS
By Greg Bordonaro

For the first time in years, the state's Medicaid program is seeing a noticeable uptick in primary care doctor participation, thanks largely to a temporary bump in pay physicians receive from the federal government.

The number of primary care providers — including advanced practice registered nurses and physician assistants — enrolled in Medicaid has more than doubled since January 2012, state Department of Social Services data shows.

The widening membership comes at a crucial time in Connecticut, as tens of thousands of new patients enter the state's Medicaid program as a result of federal healthcare reform, raising concerns over potential physician shortages.

For years, many Connecticut doctors — 40 percent in 2011, according to one survey — refused to see new Medicaid patients due to lax reimbursements from the state and federal government. Other issues like administrative hassles also plagued the insurance program for the poor.

To reverse the trend and ensure adequate access to care for new enrollees, the Obama administration agreed to temporarily increase primary care reimbursement rates for a two-year period, which, in some cases, has more than doubled payments to physicians seeing Medicaid patients.

“Many primary care physicians who had previously shunned Medicaid patients due to low fees have now opened their doors to Medicaid patients,” said Douglas Arnold, CEO of Middletown-based Medical Professional Services Inc., which has more than 450 medical providers in its statewide network.

Despite recent increased primary care provider participation, however, healthcare officials remain cautious about the future.

Matthew Katz, CEO of the Connecticut State Medical Society, said the temporary Medicaid reimbursement increase ends next year, which could quickly curb physician's enthusiasm for the program.

Meanwhile, the temporary rate hike wasn't extended to specialists like urologists and orthopedic surgeons, whose participation in Medicaid has been waning, experts say.

“The bigger challenge right now is specialty care,” said Dr. Suzanne Lagarde, an internist and CEO of the Fair Haven Community Health Center, which treats Medicaid patients. “There are not enough specialists that participate in the program.”

Connecticut doctors have long complained about lax reimbursements from Medicaid, which spends $5.2 billion annually, and accounts for nearly 25 percent of the state budget.

Some doctors estimate that for every dollar of cost incurred, in-state providers traditionally have been paid about 70 cents by Medicaid, which is jointly funded by the state and federal government. Specialists' reimbursements are even lower.

It's an issue that forced many physicians over the years to stop seeing new Medicaid patients as reimbursements failed to cover the cost of care.

“Any practice that has a significant Medicare/Medicaid payer mix will have a hard time staying viable,” Katz said.

Meanwhile, the Affordable Care Act is allowing states to widen Medicaid eligibility, and Connecticut expects to add about 150,000 new low-income patients to its program, which currently has about 631,000 enrollees.

During the first three months of open enrollment the state's new health insurance exchange signed up 17,000 new Medicaid customers, according to Access Health CT.

The temporary Medicaid reimbursement increase aims to ensure more doctors are willing to see those new patients. And it seems to be working, at least for now.

There were 3,256 primary care providers enrolled in Medicaid at the end of December, up from 2,370 in January 2013, when the reimbursement increase kicked in.

In January 2012, there were only 1,622 primary care enrollees.

Arnold, of Medical Professional Services Inc., said many of his practices' primary care doctors, particularly pediatricians, have begun seeing Medicaid patients due to the rate hike.

One primary care doctor, for example, saw reimbursements for an office visit jump from $37.43 to $82.98. “Doctors were astounded by the increase,” Arnold said.

Meanwhile, Ellen Andrews, executive director of the Connecticut Health Policy Project, said while the rate hikes have been enticing, there are other reasons doctors are signing up for Medicaid. DSS, which runs the program, has also reduced administrative hassles, cutting down on physician complaints about burdensome paperwork, late payments, rude treatment, poor communications, and unreceptive provider relations.

Many improvements were made, Andrews said, after the state switched from a managed care to a self-insured administrative services organization model in 2012, which eliminated health insurance companies from the program.

Instead of having to deal with three different insurance companies, providers now deal with a single administrative services organization, which handles medical claims for the state. That streamlined the contracting and enrollment process, and made it easier to settle payment disputes, said Kate McEvoy, DSS' director of health services. Additionally, doctors are getting paid faster (every two weeks) and can do more electronically.

“When we changed the model, it made it a lot easier for providers,” McEvoy said.

Andrews said she hopes the more efficiently run Medicaid program will entice primary doctors to remain enrolled even after the temporary reimbursement hike goes away.

Meanwhile, McEvoy said she and other healthcare officials will urge the state and/or federal government to continue the temporary increase. “We are not at a point where we are fulfilling all the needs, but the number of patient complaints is down significantly,” she said.

CT's Medicaid Expansion Explained

• The Affordable Care Act gives states the opportunity to expand Medicaid eligibility so that more people qualify for the program, which provides medical insurance to poorer citizens. The federal government has agreed to cover the costs associated with the increased enrollment.

• Connecticut was one of the first states to expand coverage and has already added about 100,000 people to its Medicaid rolls since 2010.

• As of Jan. 1, the state raised Medicaid income eligibility limits for adults without children from 56 percent of the federal poverty level to 138 percent. That means individuals who make up to $15,856 per year now qualify compared to $7,472 previously. That is expected to draw in another 50,000 enrollees.

• Overall, the state expects to add about 150,000 people to Medicaid as a result of federal health reform.

• Medicaid currently serves about 631,000 people, or 17.6 percent of the state's population.

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