State Medicaid Programs Slowly Coming Online With Parity Program

FPs Should Reap Benefits in Coming Months

July 03, 2013 04:45 pm James Arvantes

Nearly all of the nation's Medicaid programs are expected to implement a provision in the health care reform act this month that will pay eligible physicians an increased rate for providing certain Medicaid primary care services.

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As of July 1, more than a quarter of state Medicaid fee-for-service programs -- Alabama, Arkansas, Florida, Kansas, Massachusetts, Maryland, Maine, Michigan, Missouri, Montana, Pennsylvania, Vermont and Wyoming -- had implemented the temporary payment increase, according to CMS.

"Our expectation is that in the vast majority of states, the money will start flowing this month," said Matt Salo, executive director of the National Association of Medicaid Directors.

The provision, which was enacted as part of the Patient Protection and Affordable Care Act, will bring Medicaid payment rates for certain primary care services at least in line with Medicare levels for 2013 and 2014. These services are defined as those billed using specific evaluation and management (E/M) codes as well as some codes for vaccine administration.

The provision officially took effect on Jan. 1, but a combination of factors delayed actual implementation. However, states are responsible for paying physicians retroactively to Jan. 1 if those physicians attest to their eligibility for the increased payments by a certain date, which varies by state.

Story Highlights
  • Most state Medicaid programs are expected to implement a provision in the health care reform law within the next few weeks that will boost payments for eligible physicians who provide Medicaid services.
  • The provision, enacted as part of the health care reform act, will bring Medicaid payment rates for certain narrowly defined primary care services at least in line with Medicare payment levels for those same services in 2013 and 2014.
  • The provision is intended to enhance patient access to Medicaid services by increasing physician and provider participation in the Medicaid program.

To qualify for the higher payment rate, physicians related to the specialty categories of family medicine, general internal medicine or pediatrics are required to self-attest either that 60 percent of all Medicaid services they bill or provide in a managed care environment are for the specified E/M or vaccine administration codes or that they are board-certified in one of the primary care specialties. In most states, attestation deadlines for retroactive payment already have passed, but physicians still can attest and begin receiving the increased payment for the remainder of the two-year period, according to Michelle Greenhalgh, state government relations manager for the AAFP.

Salo, in addressing why the provision took longer than expected to implement, said, "Operationalizing this is much more complicated than anyone thought it would be." Lawmakers enacted the parity provision as a fee-for-service payment mechanism, but the vast majority of state Medicaid programs provide primary care services in a managed care environment, which creates payment challenges, according to Salo. "There is a lot of managed care in Medicaid, and trying to do a service-to-service crosswalk does not work easily," he noted.

As part of the process, states were required to submit a state plan amendment (SPA) by March 31, outlining how they planned to implement the higher payment rate -- whether they would make increased payments on a monthly or quarterly basis, for example. CMS has approved all but one of the state Medicaid plan amendments. California is the only state that CMS has not yet sanctioned for technical reasons. Alaska, meanwhile, is the only state not planning to implement the Medicaid primary care payment increase because their Medicaid payments already are at about 140 percent of Medicare, according to Greenhalgh.

AAFP Encourages Eligible Family Physicians to Attest

Family physicians who participate in Medicaid need to self-attest that they qualify for a Medicaid primary care payment increase or they will miss out on higher payments called for by the health care reform act, according to the AAFP.

During the past eight months, the Academy has sent several reminders to family physicians urging them to apply and has provided various resources about the provision itself, including a dedicated Web page that links to numerous related resources, including eligibility requirements, and a summary of the program.

Although the Medicaid primary care payment increase is set to expire at the end of 2014, the AAFP has made extension of the provision a major legislative priority.

"Payments to physicians practicing in managed care settings versus strict fee-for-service will see a greater delay in receiving the primary care bump because after the SPAs are approved by CMS, the state then has to go back to the managed care company and change the contracts to include the increased rates," said Greenhalgh. "The SPAs must delineate how the state will address rate changes within its Medicaid managed care plan. This process can take a while, so as a result, physicians practicing in these settings will see an even longer delay in the pay increase."

The payment provision is intended to enhance patient access to Medicaid services by increasing physician and provider participation in the Medicaid program, but the measure itself expires after two years, raising questions as to whether the provision will have the intended effect, Salo said.

Lonnie Robinson, M.D., a family physician who practices in a five-member physician practice in north central Arkansas, received a 30 percent payment increase in his Medicaid payment check two weeks ago as a result of the parity provision.

Robinson takes care of 3,500 patients, 1,500 of whom are Medicaid patients. He describes the primary care payment as a "good first step" in addressing historically low Medicaid payment rates, but he also describes the parity provision as a short-term measure. "The needs of my Medicaid patients are not going to go away (after 2014)," he said. "With Medicaid, we receive less money for taking care of a patient population that has the same or even greater health care needs as the general population."

Robinson's practice continues to accept new Medicaid patients from Arkansas, but it stopped taking new Medicaid patients from nearby Missouri about five years ago. The temporary payment provision is not likely to change that policy, Robinson said. "If the increase lasted longer than two years, we would consider changing that policy."

Nevertheless, Robinson said he is pleased with the bump in the Medicaid payment rate.