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Faced with low payment rates, most New Jersey doctors are apparently shutting their doors on Medicaid patients.
And under a plan from President Barack Obama, the same fate will befall the Medicare program, according to conservative activist Steve Lonegan.
In an Oct. 24 op-ed on the Asbury Park Press' website, Lonegan argued that changes to Medicare would lead that program down the path of Medicaid, which he claimed 60 percent of physicians in New Jersey do not accept.
"Medicaid vastly underpays doctors," wrote Lonegan, director of the New Jersey chapter of Americans for Prosperity, a conservative advocacy group. "Sixty percent of New Jersey doctors do not accept Medicaid patients. This is not a model to replicate for our seniors."
PolitiFact New Jersey found that Lonegan’s 60 percent figure is on the mark. A recent study estimated that only about 40 percent of office-based physicians in the Garden State were accepting new Medicaid patients last year.
First, let’s explain how the Medicaid system works in New Jersey.
Most Medicaid services provided in New Jersey are done through a managed care system. Under that system, the state contracts with private insurers, who manage the patients’ health care and pay the doctors directly.
Some services in New Jersey are still covered on a fee-for-service basis, in which doctors are paid by the state.
To back up his claim, Lonegan directed us to a study by Sandra Decker, an economist at the Centers for Disease Control and Prevention’s National Center for Health Statistics. That study was outlined in an article published in the August 2012 edition of a journal called Health Affairs.
The study was based on the responses of 4,326 physicians to a nationwide survey conducted by the National Center for Health Statistics from February 2011 to June 2011.
In that study, Decker estimated that about 40 percent of New Jersey doctors were accepting new Medicaid patients in 2011. To be more precise, the percent of such physicians in the Garden State is likely between 28 percent and 53 percent, according to the study.
That roughly 40 percent estimate represents the lowest percentage for any state and much less than the national average of 69.4 percent, the study shows.
Why don’t more physicians accept Medicaid patients? One reason appears to be about money: the less they’ll get paid, the less likely physicians will take on those patients.
The fee-for-service rates paid by states have been measured by how they compare with Medicare fees. Decker’s study shows that states with greater Medicaid-to-Medicare fee ratios tended to have a higher percentage of physicians accepting new Medicaid patients.
New Jersey has ranked at the bottom for fee-for-service Medicaid payments in recent years, according to different studies.
It remains unclear how those fee-for-service rates compare to what some New Jersey doctors are getting paid to treat Medicaid patients on a managed care basis. Those managed care fees are negotiated between the physicians and the insurance companies.
State officials are not involved in those negotiations, and thus don’t know how much the doctors receive, according to Nicole Brossoie, a spokeswoman for the state Department of Human Services.
But Stephen Zuckerman, a health policy expert at the nonpartisan Urban Institute, told us the two sets of rates are often similar, but doctors may get paid more in managed care systems.
However, under the health care reform enacted in 2010, certain doctors providing primary care services to Medicaid patients in both fee-for-service and managed care are supposed to receive 100 percent of Medicare rates for 2013 and 2014, according to federal regulations.
Brian Cook, a spokesman for the Centers for Medicare & Medicaid Services, said in an e-mail that the fee increase applies to every state, and federal officials expect it to attract more physicians to accept Medicaid patients.
In an op-ed last month, Lonegan claimed: "Sixty percent of New Jersey doctors do not accept Medicaid patients."
That statement is backed up by a recent study estimating that roughly 40 percent of New Jersey doctors were accepting new Medicaid patients in 2011. The study also suggests that fewer physicians accept such patients in states with lower Medicaid payment rates.
We rate the statement True.
To comment on this ruling, go to NJ.com.
Asbury Park Press, PROS & CONS: Medicare will be saved by providing choices, Oct. 24, 2012
Kaiser Health News, Study: Nearly A Third Of Doctors Won't See New Medicaid Patients, Aug. 6, 2012
The Washington Post, Study: One-third of doctors wouldn’t take new Medicaid patients last year, Aug. 6, 2012
Forbes, 'Health Affairs' Study: One-Third of Doctors Won't Accept New Medicaid Patients, Aug. 7, 2012
Health Affairs, In 2011 Nearly One-Third Of Physicians Said They Would Not Accept New Medicaid Patients, But Rising Fees May Help, August 2012
E-mail interview with Steve Lonegan, New Jersey director of Americans for Prosperity, Oct. 24, 2012
Kaiser Commission on Medicaid and the Uninsured, Physician Willingness and Resources to Serve More Medicaid Patients: Perspectives from Primary Care Physicians, April 2011
Centers for Disease Control and Prevention, Physician Acceptance of New Medicaid Patients by State in 2011, Aug. 7, 2012
Avalere Health LLC, 2006 New Jersey Health Care Almanac, November 2006
Health Affairs, Trends In Medicaid Physician Fees, 2003–2008, April 28, 2009
The Henry J. Kaiser Family Foundation, New Jersey: Medicaid Physician Fees, accessed Oct. 24, 2012
Public Citizen Health Research Group, Unsettling Scores: A Ranking of State Medicaid Programs, April 2007
American Academy of Pediatrics, Medicaid Reimbursement Reports, accessed Oct. 24, 2012
New Jersey Department of Human Services, Section 1115 Demonstration Comprehensive Waiver, Sept. 9, 2011
E-mail interview with Nicole Brossoie, spokeswoman for the New Jersey Department of Human Services, Oct. 25-26 and Nov. 8, 2012
E-mail interview with Stephen Zuckerman, senior fellow with the Health Policy Center at the Urban Institute, Oct. 24-26, 2012
E-mail interview with Brian Cook, spokesman for the Centers for Medicare & Medicaid Services, Oct. 25, 2012
U.S. Department of Health and Human Services, Health care law increases payments to doctors for primary care, May 9, 2012
Centers for Medicare & Medicaid Services, The Affordable Care Act Becomes Law, accessed Oct. 25, 2012
Kaiser Commission on Medicaid and the Uninsured, A Profile of Medicaid Managed Care Programs in 2010: Findings from a 50-State Survey, Sept. 13, 2011
Kaiser Commission on Medicaid and the Uninsured, Medicaid and Managed Care: Key Data, Trends, and Issues, February 2010
E-mail interview with Joel Cantor, director of the Center for State Health Policy at Rutgers University, Oct. 24-26, 2012
U.S. Department of Health and Human Services, Medicaid and CHIP Risk-Based Managed Care in 20 States: Experiences Over the Past Decade and Lessons for the Future, July 2012
Federal Register, Payments for Primary Care Services Under the Medicaid Program, accessed Oct. 25, 2012
Robert Wood Johnson Foundation, Does Medicaid Managed Care Market Penetration Impact Provider Participation, Costs, Utilization, and Access?, September 2010
E-mail interview with Jeff Lancashire, a spokesman for the National Center for Health Statistics, Oct. 26 and Nov. 8, 2012
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