Eyeworld

EW NEWS & OPINION 18 February 2015 Insights by J.C. Noreika, MD, MBA The shocking truth of unintended consequences rates; Medicaid fees averaged 59% of Medicare reimbursement for primary care services in 2012. States' budgets must be balanced annually and many are strained to the breaking point. California, New Jersey, and Illinois have found it difficult to meet the requirements of the Medicaid expansion. As the law is written, the federal government pays 93% of the state's spending increase accruing to the expansion. Some governors question whether this can continue in perpetuity. Because states can exercise limit- ed prerogative to charge Medicaid premiums to recipients above 150% of the FPL and nominal cost-sharing even to some below the 100% FPL to offset revenue shortfall, beneficiaries may see their costs increase. Access of the newly insured to care can be affected adversely, if unintentionally, for several reasons: 1. Closure of safety-net hospitals. Most Medicaid in-patients re- ceive care through managed care arrangements. Capitation is the favored reimbursement model. Hospitals with large Medicaid populations may not be economi- cally viable; 2. State-imposed beneficiary co-pay- ments and premiums. The budgets of the poor and near poor may not be sufficient to enable pay- ment. Providers, not the state, are responsible for collection of co-payments; 3. Physicians in private practice— especially primary care providers —may choose to shun Medicaid The Affordable Care Act promises health insurance, but will the newly insured find a doctor who takes it? C asablanca is regarded by many as the greatest movie ever made. In one icon- ic scene, police captain Louis Renault announces to its patrons that Rick's Café is closed until further notice. Owner Rick Blaine, played by Humphrey Bogart, asks why he must shutter. As a croupier presents him with his generous "winnings," Captain Renault responds with straight face, "I'm shocked, shocked to find that gambling is going on in here!" When the Affordable Care Act (ACA) became law, some foresaw the prospect that many of the nation's uninsured would receive Medicaid coverage but not have access to medical care. In the December 18, 2014 issue of the New England Journal of Medicine, Sara Rosenbaum, JD, of the George Washington University School of Public Health and Health Services, explores the dynamic between Medicaid payment and access to care. Medicaid is an intrinsic social and economic safety net. It became law in 1965 with the enactment of Medicare under President Lyndon Johnson. Now covering more than 66 million beneficiaries, it is the nation's largest health insurance provider exceeding Medicare and all private insurance plans. In 2013, ac- cording to the Henry Kaiser Family Foundation, it covers more than 1 in 3 American children (more than 31 million) and more than 40% of births. More than 60% of nursing home inhabitants and half of HIV patients get Medicaid assistance. In 2014, the ACA granted ex- panded Medicaid access to millions of uninsured adults under age 65 with incomes below 138% of the Federal Poverty Level (FPL). Estimat- ed by the U.S. Department of Health and Human Services, income levels at or below $23,850 for a family of four delimit the 2014 FPL. Poverty in America disproportionately affects racial and ethnic minorities, the disabled, children, and the elderly. In June 2012, the U.S. Supreme Court upheld the ACA's consti- tutionality but allowed states the option to participate in the law's Medicaid expansion. As of December 2014, 27 states and the District of Columbia have expanded coverage and another 4 are considering it. For example, because of recent hospital closures, Tennessee is now contem- plating participation. To qualify for federal funds, the government man- dates that state Medicaid programs provide 15 essential services. Twice as many services may be provided at the state's discretion. The states set reimbursement levels paid to providers. In reality, there are more than 50 unique state-run Medicaid programs with relatively benign fed- eral oversight. States' expenditures vary widely. In FY 2012, California paid out more than $50 billion, Wyoming $528 million. Eight states including California, Florida, and New York pay providers less than 60% of Medicare's allowed amounts. To enlist doctors' participation and promote beneficiary access to services, the ACA increased primary care physicians' reimbursement to 100% of Medicare's allowed. This provision had its sunset at the end of 2014. Many states have reverted to paying providers at traditional patients. The closure of commu- nity and volunteer health centers due to cost and staffing issues complicates the issue; 4. Large health systems employ- ing doctors project a shortage of 30,000 primary care providers by 2015. Expansion of the scope of practice of physician assistants, nurse practitioners, and midwives is inevitable but inadequate; 5. Reimbursement rates for specialty care may not reflect overhead, the cost of compliance with regula- tions and investment in technolo- gy. Does $45.55 that Ohio Med- icaid pays vision care providers for a comprehensive new patient medical eye evaluation meet its cost to the practice?; 6. The belief among physicians that Medicaid patients are less compli- ant with therapy and follow-up appointments. A 2013 study of Oregon's Medicaid lottery experi- ment showed no improvement in most significant health outcomes; 7. The perception that Medicaid re- cipients are more likely to initiate a malpractice claim. Contempo- rary studies are unavailable but older research by the U.S. General Accounting Office refutes this assumption. Primarily a geriatric specialty, ophthalmology is not directly im- pacted to the extent of family prac- tice and pediatrics. Medicare com- pensates my practice approximately $650 for performing a cataract extraction with lens implantation. Ohio Medicaid reimburses at about $600. Comparing the two, personal bias determines the glass half-full or half-empty. But healthcare's architects and strategists must acknowledge that unintended consequences do have unexpected repercussions. After all, a "shocked" Captain Renault's disingenuous objection to gam- bling did compel Rick's patrons to find somewhere else to drown their sorrows. EW Editors' note: Dr. Noreika has practiced ophthalmology in Medina, Ohio, since 1983. He has been a member of ASCRS for more than 30 years. Contact information Noreika: JCNMD@aol.com J.C. Noreika, MD, MBA

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