Senate Delay Could Result in Medicaid Cuts to Physicians

June 29, 2010 05:00 pm News Staff

The U.S. Senate is delaying efforts to pass a bill to provide $16 billion in Medicaid assistance to states for the first six months of 2011, a move that could result in Medicaid cutting payments to physicians. The funding in the bill is designed to assist states with projected increases in their Medicaid populations that are likely because of a faltering economy and federal coverage requirements in the recently enacted health care reform legislation.

"Despite recent promising economic signs, state revenues -- as they always do -- are lagging far behind the general recovery," said Greg Martin, manager of the AAFP's state government relations program. "If this funding does not arrive, it will shoot a big hole in already strained state 2011 budgets."

States, in turn, will have few options remaining for cutting budgets and raising revenues, putting Medicaid payments to physicians at risk, according to Martin. At least 30 states budgeted for the six-month increase in 2011. That funding originally was set at $24 billion and later trimmed to $16 billion.

The bill, H.R. 4213, also contains millions of dollars in aid to state governments and an extension in emergency unemployment benefits. The measure originally included a Medicare payment update, but Senate Majority Leader Harry Reid, D-Nev., stripped the payment provision out of the bill to move it forward separately. That stripped-down bill passed on June 25.

Meanwhile, the Senate leadership has been unable to muster the 60 votes needed to pass the larger bill that contains the Medicaid funding.