CMS Releases Final Rule on Medicaid-Medicare Payment Parity

Academy Urges States to Immediately Take Action on Implementing Provision

November 02, 2012 11:30 am News Staff

The AAFP is praising the release of a final CMS rule that implements a provision in the health care reform law that brings Medicaid payment for certain primary care services up to Medicare levels for the next two years.

[This Just In-Newspaper in hand]

In a prepared statement, the Academy said the rule is a "step in the right direction." The AAFP is urging states to act quickly to implement the payment provision so low-income, working families and the elderly in nursing homes can immediately benefit from the provision.

"We know from research that when Medicaid beneficiaries cannot find a physician who accepts new Medicaid patients, they face the same access problems as those who have no insurance," said AAFP President Jeff Cain, M.D., of Denver, in the statement. He noted that these patients are less likely to have a usual source of care, and they tend to skip needed preventive and acute care. Because of this, they often develop complications that require intensive and costly medical intervention and generally have poorer health.

Although current law limits the payment parity rule to only two years, "bringing Medicaid payments up to Medicare levels will do much to enable physicians to care for Medicaid patients," said Cain.

The final CMS rule implements Section 1202 of the Patient Protection and Affordable Care Act, and requires state governments to take further action before 2013 to implement the provision, prompting the AAFP's call for states to take immediate action. Cain pointed out that states will receive an estimated $11 billion in new funds during 2013-2014 to bolster their Medicaid primary care delivery systems. He stressed, however, that the funding is only temporary.

"Unless Congress acts to permanently extend and fund this provision, a sudden return to disparate and inadequate payment for primary services needed by Medicaid patients after only two years will again threaten to restrict their access to such needed services," said Cain. "It would once again shut out people who have come to know and depend on their primary care physicians. Only by extending Medicaid parity with Medicare can we ensure that these Americans continue to have uninterrupted medical care in the future.”

Cain noted that more than six in 10, or 64 percent, of family physicians accept new Medicaid patients and that Medicaid beneficiaries make up 15 percent of the average family physician’s patient panel.

"Family physicians commit themselves to a long-term relationship with all their patients, including Medicaid beneficiaries," said Cain. "However, increasingly inadequate Medicaid payment has forced nearly two in 10 family physicians to stop accepting new Medicaid patients."


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