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Affordable Care Act Medicaid Pay Increases

By Jon Jantz, MD, FAAP

The biggest issue facing pediatricians reimbursement this year is reinstating the Affordable Care Act (ACA) Medicaid pay increases that were in place for 2013 and 2014 that raised it to Medicare rates, 30-40% depending on the service rendered.  The purpose of the change was to increase the number of practices that take Medicaid and to increase the number of Medicaid patients allowed into practices.  This is inherently obvious to practices that take Medicaid.  However, a less obvious but equally important issue is the effect that the increased Medicaid payments had on some commercial payments.  Medicaid has traditionally acted as the floor or lowest acceptable payment for services.

During 2013 and 2014 the ACA Medicaid reimbursement rate actually increased above a few commercial rates.  This resulted in a quiet, but important but small upward shift in some commercial reimbursement rates.  As such, Medicaid reimbursement rates affect all of us either directly or indirectly.  It is too early to tell and the experiment was too short to determine if it would attract more physicians into primary care.

As a summary of back ground information, the AAP and partnering physician organizations have continued a strong push for an extension of the 2013 and 2014 Medicaid payment increase, urging swift passage in the last Congress and reintroduction in the current Congress of the Ensuring Access to Primary Care for Women and Children Act (S 2694) to extend federal funding of Medicaid payment equity for 2 more years. While the 113th Congress adjourned January 2 without passing this legislation, the 114th Congress could act to extend Medicaid payment equity as part of a Medicare payment provision this year, in a Children’s Health Insurance Program (CHIP) funding expansion, or many other legislative packages.

The President has just released his budget proposal for the 2016 federal fiscal year, and it includes $6.3 billion to extend Medicaid payment equity through 2016. The AAP will work with the President and Congress to support an extension of this critical federal funding.

State AAP chapter activities to support this federal extension have been enormously helpful.  If you are interested in joining the effort, log on to federaladvocacy.aap.org to urge Congress to continue this much needed increase in Medicaid payment.

State Medicaid programs are no longer receiving targeted federal support for the increased payments—should Congress pass a federal extension, the increased payments could be resumed retroactively. States may be making payments for services rendered in 2014 into the new year at increased rates, but services rendered in 2015 currently are paid and will continue to be paid at our state’s existing Medicaid rate unless sate or Federal legislation is enacted.

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