In an attempt to offset rising Medicaid costs, states are increasingly reducing payments to health care providers, which could add to the shortage of providers participating in the program, Kaiser Health News/USA Today reports.
Many of the cuts went into effect on July 1 or will take effect later in the month (Galewitz, Kaiser Health News/USA Today, 7/6).
The cuts coincide with the end of billions of dollars in supplemental funding from the 2009 federal economic stimulus package to help state Medicaid programs cope with the economic downturn (California Healthline, 6/30).
Colorado, Nebraska, Oregon and South Carolina are reducing payments to physicians this month, while Arizona cut rates in April and will further reduce rates in October.
Colorado, Connecticut, Florida, Nebraska, New Hampshire, North Carolina, Oregon, Pennsylvania, South Carolina, Texas, Virginia and Washington all are cutting payments to hospitals. New York already reduced hospital payment rates in April. California lawmakers approved a 10% payment reduction for doctors and hospitals, but the plan has been shelved because of a pending lawsuit.
Many insurers and employers say cutting payment rates will prompt health care providers to increase their prices and thus shift costs to privately insured patients.
Robert Zirkelbach, a spokesperson for America's Health Insurance Plans, said, "It's always a concern that when providers get less from Medicaid, that they will shift the costs to private insurance so families and employers pay more" (Kaiser Health News/USA Today, 7/6).