Medicaid crisis socks doctors

Low reimbursement could force some physicians to drop Medicaid patients.

By Joel B. Finkelstein, AMNews staff. May 12, 2003.

Washington -- As financially squeezed state governments look for further Medicaid cuts, physicians across the country are warning of grave consequences for patient care.

"Proposed cuts are causing a great deal of anxiety among physicians," said Helen Kent Davis, director of governmental affairs for the Texas Medical Assn.

Texas' House of Representatives has proposed slashing $3 billion from the Medicaid program, including eliminating coverage for a half-million Texans and reducing payment rates to physicians and others by 5%.

Currently about 89% of Texas family physicians accept Medicaid patients, but that number would drop to 59% if the cuts go into effect, according to a survey by the Texas Academy of Family Physicians.

A recent study conducted for the TMA showed that every dollar trimmed from the state's Medicaid program means an additional 53 cents in uncompensated care provided by physicians and others. A dollar less in Medicaid money also equals $1.34 more in health insurance premiums and $2.81 less in federal funds.

Illinois is also in trouble. While Gov. Rod Blagojevich is looking for ways to avoid making any more Medicaid cuts, the program is struggling with a six-month backlog in reimbursement to physicians and others.

There has always been a wax and wane in the reimbursement cycle, said William Kobler, MD, president of the Illinois State Medical Society. But recently payments to physicians have fallen further and further behind.