Payment generosity and physician acceptance of Medicare and Medicaid patients
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Payment generosity and physician acceptance of Medicare and Medicaid patients Christopher S. Brunt · Gail A. Jensen
Received: 24 February 2014 / Accepted: 18 June 2014 / Published online: 9 July 2014 © Springer Science+Business Media New York 2014
Abstract Using 2008 physician survey data, we estimate the relationship between the generosity of fees paid to primary care physicians under Medicaid and Medicare and his/her willingness to accept new patients covered by Medicaid, Medicare, or both programs (i.e., dually enrolled patients). Findings reveal physicians are highly responsive to fee generosity under both programs. Also, their willingness to accept patients under either program is affected by the generosity of fees under the other program, i.e., there are significant spillover effects between Medicare and Medicare fee generosity. We also simulate how physicians in 2008 would have likely responded to Medicaid and Medicare payment reforms similar to those embodied in the 2010 Affordable Care Act, had they been permanently in place in 2008. Our findings suggest that “Medicaid Parity” for primary care physicians would have likely dramatically improved physician willingness to accept new Medicaid patients while only slightly reducing their willingness to accept new Medicare patients. Also, many more primary care physicians would have been willing to treat dually enrolled patients. Keywords
Access to care · Medicare part B · Medicaid · Affordable Care Act
JEL Classification
I10 · I12 · I18
Introduction The 2010 Patient Protection and Affordable Care Act (ACA) includes several provisions designed to enhance support for primary care in the United States. Some provisions temporarily raise the fees paid by Medicare and Medicaid to primary care providers, and another C. S. Brunt (B) Department of Finance and Economics, Georgia Southern University, Statesboro, GA 30460, USA e-mail: [email protected] G. A. Jensen Institute of Gerontology and Department of Economics, Wayne State University, Detroit, MI 48202, USA e-mail: [email protected]
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changes the way that the Medicare Part B physician fee schedule, known as the resource-based relative value system (RBRVS), adjusts Medicare fees for the cost of operating a medical practice. If these reforms are extended or become permanent, what effects are they likely to have on the willingness of primary care physicians to accept new patients covered by Medicaid, Medicare, and patients covered by both Medicare and Medicaid, who often have extensive health care needs because of their multiple illnesses and disabilities? This paper examines this question. For many primary care services, the ACA dramatically raises Medicaid fees during 2013 and 2014 to at least the level of Medicare fees. This provision is known as “Medicaid Parity.” This year Medicaid fees are rising on the order of 50–80 % in many states, and in some, such as FL, RI, NY, CA, MI, and NJ, Medicaid fees are more than doubling (Zuckerman 2012). The law also includes a
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