Michigan moves to minimize Medicaid payment rate reductions for doctors

December 29, 2014
Michigan will spend $25 million next year to minimize looming cuts to Medicaid rates for primary care doctors and promote continued access for the state's growing number of low-income Medicaid patients. The ACA funded a two-year increase in Medicaid reimbursement rates for primary care services which is set to expire on Jan. 1. At least 15 states moved to minimize the reduction, according to the Kaiser Family Foundation. Michigan's 2015 budget includes $72.5 million for partial continuation of the Medicaid primary care fee "uplift" from Jan. 1 through Sept. 30. Of that, $25 million is state money from the general fund and the rest is federal funding. If the state hadn't boosted funding, Michigan physicians would have seen Medicaid fees reduced by 58% this year, according to a study by The Urban Institute, the third largest cut in the nation. Michigan's partial uplift seeks to halve that reduction. Medicaid rates will be set at around 78% of Medicare, up from 60% prior to the ACA, according to the Michigan State Medical Society. Prior to the ACA, Fountain said that primary care physicians were essentially taking a loss for each Medicaid patient they saw, earning 60 cents on the dollar for their services. More than 507,000 residents signed up for Healthy Michigan since April, when the state expanded the program. Enrollment, championed by Republican Gov. Rick Snyder, has already surpassed all goals, and federal funding was projected to save the state some $240 million in general fund spending.