Medicaid Reimbursement for Primary Care

To qualify for higher Medicaid reimbursements, primary care services must be rendered by:

  1. Physicians specializing in family medicine, general internal medicine, or pediatrics;
  2. Board-certified physicians in subspecialties relating to primary care (e.g. pediatric cardiology); or
  3. Physician extenders (PAs and NPs) operating under the supervision of eligible physicians.

The rule allows much flexibility in implementing the increased payments. First, states can choose either to lock in rates effective in January or to follow all fee schedule updates by Medicare. Secondly, states may decide to pay amounts adjusted for location or establish a statewide average rate. Thirdly, states must take into account these modified payments in their Medicaid managed care plans contracts.

Central to the mission of healthcare reform is a greater focus on disease prevention and primary care. Health and Human Services (HHS) Secretary Kathleen Sebelius declared: "By improving payments for primary care services, we are helping Medicaid patients get the care they need to stay healthy and treat small health problems before they become big ones."

By Christopher K. Lee, Valuation Analyst and Healthcare Strategist with Transition Consultants