Where will new Medicaid beneficiaries get healthcare?

Millions of people will gain insurance under the Affordable Care Act, but will they be able to get appointments with healthcare providers? Coverage doesn't automatically translate into access, and some newly insured individuals will struggle to find physician practices that will take them on as patients. In particular, states that adopt the (now optional) Affordable Care Act Medicaid expansion, which extends eligibility to adults up to 133% of the poverty level, may encounter a severe shortage of providers willing to accept new Medicaid patients. Although Medicaid reimbursement levels vary from state to state, in general they're substantially lower than other payers' rates.

A study by Sandra L. Decker in the latest issue of Health Affairs gives us some hard numbers on physicians' willingness to accept new Medicaid patients. Decker, an economist at CDC's National Center for Health Statistics, used recent survey data to investigate what percentage of physicians are accepting new Medicaid patients and how states' different payment rates might affect physicians' willingness to accept these patients. The data are from the Electronic Medical Records Supplement to the National Ambulatory Medical Care Survey (NAMCS), which annually surveys a randomly selected sample of nonfederally employed physicians primarily engaged in office-based patient care. Decker analyzed 4,326 physician responses to the survey's 2011 EMR supplement, which asked physicians if they were accepting new patients and, if so, which types of payments they accept from the new patients.

Decker found that overall, 96% of physician practices (94% of primary-care providers and 98% of specialitsts) reported accepting new patients, but only 69% of physicians said they're accepting new Medicaid patients. For comparison, here's the breakdown of physicians who reported accepting new patients with each of the following payment types:

  • 92% accepting new self-pay patients
  • 83% accepting new Medicare patients
  • 82% accepting new privately insured patients
  • 69% accepting new Medicaid patients

Factors associated with a greater physician likelihood of accepting new patients included being part of a group (rather than solo) practice, being located outside of metropolitan statistical areas, and practicing in counties where at least 15% of the population was under the federal poverty level. But the most important finding for policymakers is this: Acceptance rates of new Medicaid patients were higher in states with higher Medicaid-to-Medicare fee ratios.

In New Jersey, for instance, only 40% of physician respondents said they were accepting new Medicaid patients; Wyoming is at the other end of the spectrum, with a 99% acceptance rate. Here's Decker's description of the states with higher-than-average acceptance rates:

Twenty-one states had acceptance rates for new Medicaid patients that were significantly higher than those of other states. These states included several in the Midwest and West, two states in New England (Massachusetts and New Hampshire), and five in the South (Arkansas, Kentucky, Mississippi, South Carolina, and West Virginia).

Decker's analysis found that increasing physician Medicaid payments to Medicare levels would increase the national average acceptance rate of new Medicaid patients from 70% to 79%. Such an increase is slated to occur under the Affordable Care Act for 2013 and 2014, but Decker notes that the temporary nature of these increases might mitigate their impact.

Among the study limitations Decker highlights is the use of county-level poverty and Medicaid and Medicare fee data from 2008 while the survey data on new-patient acceptance is from 2011. She also notes that she didn't have data on other factors potentially important to Medicaid acceptance rates, like Medicaid administrative barriers or payment delays.

Another Solution: Community Health Centers
Raising states' Medicaid provider payment rates isn't the only way to increase Medicaid beneficiaries' access to care. Community health centers are already a major source of care for Medicaid beneficiaries, as well as for the uninsured. Health centers are located in underserved communities and provide comprehensive primary care to everyone who comes to them, regardless of insurance status, and charge sliding-scale fees based on income.

Over 20 million people get care at 8,000 health center sites across the country (search here for sites near you). Health centers provide comprehensive prenatal care, chronic disease management, nutritional counseling, and enabling services like translation and case management. By providing high-quality primary care, they help prevent negative health outcomes like low birthweight and heart attacks -- and that translates into savings for the health system, as well as improved quality of life for families and communities. Health centers also have bipartisan appeal; President George W. Bush gets credit for doubling federal funding to health centers during his time in office.

Given that community health centers are already providing high-quality, cost-effective care to underserved populations, they're a natural source of primary care for new Medicaid enrollees and other previously uninsured people who gain coverage under the ACA. The law's creators knew this, and included an $11 billion Health Center Trust fund in the ACA for health center capital expenditures and expansions over the FY 2011-2015 period. (Many health centers also received stimulus funds to improve and expand their facilities.) But, as we saw with the Prevention and Public Health Fund, both the Obama Administration and Congress seem to have a hard time resisting the temptation to raid public-health investment funds to plug other budget gaps.

Under the ACA, Health Center Trust Fund money should have totaled $1 billion in FY 2011, with most of that money going to health-center capacity expansions. But the April 2011 budget deal that averted a government shutdown slashed that to $600 million, and most of that was shifted from expansions to ongoing operations because the budget for funding existing centers' operations was also cut. The FY 2012 federal appropriations level is also far below the amount specified in the ACA, and will also have to be largely devoted to sustaining existing capacity rather than adding new capacity. (If you want all the gory details, they start on page 12 of this brief from the Kaiser Commission on Medicaid and the Uninsured.)

Investing in community health center expansion could help create the capacity we'll need to serve new Medicaid beneficiaries and others who gain insurance coverage under the ACA beginning in 2014. It could also lead to better health and long-term healthcare savings in the communities where health centers operate. The hardest part seems to be convincing Congress to resist budget brinksmanship and let the US make this sensible investment in health.


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