Medicare & Medicaid Access to Care Under the Affordable Care Act (2024)

How will physicians and beneficiaries be affected by the Medicare and Medicaid changes under the Affordable Care Act?

My prediction is that our reimbursem*nt for patient care will fall below the cost of providing patient care. Physicians will lose, but will be rescued by the hospitals and mega-groups that dominate medical care today. The big losers will be the patients who depend on Medicare for their medical care. This will be most acute in the primary care setting.

In 2010 the Affordable Care Act (ACA) was passed. In order to balance the budget, $716 billion was taken out of Medicare to finance the ACA. This action will decrease reimbursem*nt to physicians and hospitals for Medicare services. The end result will be decreased access to care for Medicare patients especially at the primary care level.

In 2014, Medicaid will be expanded under the ACA. This change will take in the economically poor who currently make too much money to qualify under current Medicaid guidelines. As a result, government spending for Medicaid will increase, especially at the federal level initially. The effect on the poor will be to provide insurance coverage. This group is the clear winner, but Medicaid rolls will dramatically increase.

There is a difference in the way hospitals are reimbursed compared to physicians. Because the hospitals have a more effective lobby, they will benefit differently under the ACA because their reimbursem*nt will increase for services they already provide, but are not currently being paid for. They provide care across the board to all economic classes, and have a much greater challenge than individual physicians. As a result, hospitals are reimbursed for Medicaid at a rate that is greater than their cost. Thus, they make a profit, and the net effect will be increased profits because their costs are less than what they take in. Whatever decrease they see in Medicare will be more than made up by Medicaid. And, they will make a profit from both groups. It is no wonder the hospitals and their associations are in favor of the ACA.

Physicians are in a different position. Our reimbursem*nt for Medicaid is less than our cost for providing the care. Thus, we lose money for seeing Medicaid patients. This is the moral hazard of being a good physician and providing care for the poor. Yes, it cost you money, and it’s a good thing to do, but you pay for it. “No good deed will go unpunished.”

Currently, some physician reimbursem*nt for Medicare exceeds the cost, especially for surgery and specialty care. This is not true at the primary care level. At best, primary care physicians barely break even. The irony is that Nurse Practitioners and Physician Assistants get higher fees for seeing patients in primary care. This accounts for the access problem in primary care. This is one of the driving forces pushing primary care physicians into the mega groups that are beginning to dominate medicine today.

Because of the changes in Medicare in 2014 and the potential effects of the Sustainable Growth Rate reduction, there will be decreased reimbursem*nt for physician services. This will cause a negative economic incentive for primary care physicians to see Medicare patients. And, that will cause the Medicare beneficiaries to have an access problem, especially in the primary care arena. This is a relatively new phenomenon for Medicare.

For physicians, Medicaid reimbursem*nt is already below our costs. When this group is expanded in 2014, the burden on physicians will only be greater. The number of patients will increase with no increase in payment for services.

My prediction is that both groups (Medicare and Medicaid) will be in the same boat. Reimbursem*nt will be below the cost of providing care. Access will be a major problem.

Already Medicaid patients have a severe problem with access to medical care. I’m afraid the Medicare population will have the same fate. Unless they purchase supplemental insurance, the Medicare population will have a difficult time obtaining medical care, particularly for primary care needs.

Hospitals will do fine and continue to make a profit. However, physicians will not do fine. They will make less under the changes in both Medicare and Medicaid. Fewer physicians will continue to care for tese populations, and access will become the major problem. The biggest losers will be the Medicare beneficiaries.

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