Healthcare Business News

Reform Update: California health committee seeks parity between Medicaid, Medicare payments

By Andis Robeznieks
Posted: February 24, 2014 - 4:30 pm ET

The chairman of the California state Assembly Health Committee, a pediatrician himself, is sponsoring a bill to make permanent a parity provision between Medicaid and Medicare payments for primary-care services. If he succeeds, it could prompt other states to try doing the same.

Dr. Richard Pan and Assemblywoman Nancy Skinner, both Democrats, recently introduced legislation (PDF) that would reverse the 10% Medicaid pay cut California physicians are experiencing.

Pan also is sponsoring a bill that seeks to make permanent the Patient Protection and Affordable Care Act's two-year parity provision equalizing Medicaid and Medicare payment for primary-care services.

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The cost of stopping the 10% cut and restoring Medi-Cal pay to June 2011 levels has been estimated at $400 million. No estimate has been provided for the parity bill. That bill calls for parity to “continue indefinitely,” but “only to the extent that federal financial participation is available.”

Expanding Medicaid coverage is just an “empty promise” and will not lead to increased access to care unless physicians are adequately reimbursed for their services, Pan said. Skinner noted at a recent news conference that California doctors receive only $18 for an office visit with a patient enrolled in Medi-Cal, the state's Medicaid program.

“Getting a pizza delivered costs about the same as what California now reimburses doctors for Medi-Cal patient visits, it should be clear to everyone which service is worth more,” Skinner, chairwoman of the Assembly Budget Committee, said. “California needs to fix reimbursement rates so we don't undermine the very program designed to cover millions of individuals and families in need of healthcare.”

More than 8.5 million Californians are covered by Medi-Cal. That number is expected to increase by 2 million under the Affordable Care Act.

Dr. Richard Thorp, president of the California Medical Association, noted that Medi-Cal enrollees were having a hard time getting to see a physician and that these bills would help ensure that patients get “real access” to healthcare.

The Affordable Care Act, in an attempt to ensure that there would be enough physicians willing to provide the care promised by Medicaid expansion, equalized Medicare and Medicaid primary-care payments for 2013 and 2014. Implementation was slow and most states' programs were not in place until late last year, which required the bulk of this reimbursement increase to be paid retroactively.

The American Academy of Family Physicians is advocating to make Medicaid parity permanent.

Docs mark anniversary of SGR patch

Doctors decided that Feb. 20 was an SGR anniversary worth noting but definitely not celebrating.

On that day in 2003, then-President George W. Bush signed into law the first legislative “patch” delaying Medicare pay cuts to physicians as called for by the sustainable growth-rate payment formula that was part of the 1997 Balanced Budget Act. The signing in 2003 started a Congressional “kick the can” tradition that has resulted in 16 patches (PDF) costing a total of $153.7 billion.

“Physicians throughout America today are recognizing a truly rotten anniversary,” Dr. Molly Cooke, president of the American College of Physicians, said in a release.

Cooke urged doctors to send messages “via every social media platform” that it was time to repeal the SGR.

The ACP took its fight to twitter using the hashtag #SGR_11_16_154 to mark the 11th anniversary of the SGR and its 16 patches costing just under $154 billion.

Robert Doherty, ACP senior vice president of government affairs and public policy, tweeted “We Don't Need No Stinkin' Patches,” and linked to his blog post explaining 12 reasons to stop the “highway robbery” being perpetrated on taxpayers by the 11 years of SGR patches.

Dr. Sue Bornstein a member of the ACP Board of Governors tweeted “Patches are for clowns and this ain't funny.” Dr. Jacqueline Fincher, also on the ACP board, keeps her tweets protected, but Doherty tweeted the “prescription” she wrote to Sen. Johnny Isakson (R-Ga.) which called for no more SGR patches, “no refills,” and for Isakson and his colleagues to “Pass S. 2000 now”

Senate Bill 2000 is the SGR Repeal and Medicare Provider Payment Modernization Act, which—as the name suggests—would repeal the SGR and enact several other physician payment reforms. Physician associations have been pressing Congress to pass the measure, but they have been quiet in offering suggestions on how to cover its estimated $126 billion cost.

One physician group that has come up with a suggestion is the American Society for Radiation Oncology, or ASTRO, which “urges the closure of the physician self-referral loophole” for in-office ancillary services as a pay-for.

The Promoting Integrity in Medicare Act of 2013, introduced last year, called for eliminating in-office ancillary services and ASTRO recommends incorporating that bill into the current SGR-repeal legislation.

An SGR-driven 24% Medicare pay cut will take effect unless Congress acts by March 31.

Follow Andis Robeznieks on Twitter: @MHARobeznieks

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