Academic journal article Inquiry

Differential Responses among Primary Care Physicians to Varying Medicaid Fees

Academic journal article Inquiry

Differential Responses among Primary Care Physicians to Varying Medicaid Fees

Article excerpt

Abstract

The Affordable Care Act (ACA) provided for significant increases in Medicaid fees for primary care services--up to 100 percent of Medicare fees for 2013 and 2014--to encourage increased Medicaid participation among primary care physicians (PCPs). In this study, I use non-linear multivariate regression techniques and data from nationally representative physician surveys and periodic Medicaid fee surveys to investigate heterogeneity in the effects of such increases. I find that the PCPs more responsive to Medicaid fee changes are those who see fewer Medicaid patients typically. I also estimate effects associated with Medicaid fee increases comparable with the ACA's fee changes.

Keywords

Affordable Care Act, Medicaid, primary care

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By 2022, there may be as many as 21 million new Medicaid and Children's Health Insurance Program enrollees (Holahan et al. 2012). Most will be enrolled over the next few years as states take advantage of the Affordable Care Act's (ACA) enhanced Federal financing arrangements and expand their Medicaid populations to include nearly all individuals with incomes below 133 percent of the Federal Poverty Level. If all states were to do so, perhaps 70 percent of these new enrollees will have been previously uninsured (Holahan and Headen 2010). It is hoped that, as a result, many individuals and families will have significantly improved access to primary care and other important health care services.

However, in recent years, fewer physicians indicate they are accepting new Medicaid patients in their practices (Decker 2012; 2013). Researchers often attribute this decline to low fees and increased administrative (e.g., delayed payments) and patient burdens associated with many Medicaid programs (Cunningham and Nichols 2005; Cunningham and O'Malley 2009; Davidson 1982; Decker 2007; Hadley 1979; Long 2013; Sloan, Mitchell, and Cromwell 1978). In part to address concerns that Medicaid's low fees may be insufficient to attract primary care physicians (PCPs) to care for expanding Medicaid populations (Miller 2013; Sommers, Swartz, and Epstein 2011), the ACA provided for federally subsidized increases in Medicaid fees for primary care services up to 100 percent of Medicare fees for 2013-2014. On average, this represented an increase of approximately 73 percent over 2012 fee levels across states, with significant variation across states (Zuckerman and Goin 2012). States expanding their Medicaid programs may be counting on these increases to help ensure new beneficiaries will have adequate access to care.

The last two decades' studies of PCP responses to varying Medicaid fee generosity have typically found that their impact on PCPs' Medicaid participation is small-to-moderate (Berman et al. 2002; Cobum, Long, and Marquis 1999; Fanning and de Alteriis 1993; Perloff, Kletke, and Fossett 1995; PerlofFet al. 1997; Zuckerman et al. 2004). Notably, these studies' results have been drawn from only moderate-sized physician samples, data from limited geographic areas where fee changes were relatively small, or data too old to reflect recent declines in physicians' Medicaid participation. Decker (2012) found larger effects but relied on state-level data only.

Researchers have also explored the effects of PCP-and practice-level characteristics on PCPs' participation in Medicaid, reflecting heterogeneity among physicians (Decker 2012; Reschovsky and O'Malley 2008; Socha and Bech 2011; Tucker 2002). To date, researchers have not investigated to what extent and why such characteristics may predict different responses to varying Medicaid fee generosity.

In this article, I identify how differences in states' Medicaid fee generosity and key PCP-and group-level characteristics--including practice ownership, practice type, compensation arrangement, experience, and perceived quality--interact in determining the extent to which different PCP subgroups participate in Medicaid. …

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