I have written a couple of pieces documenting the high percentage of physicians who refuse to take Medicaid patients, and some of the reasons for their refusal. One of my pieces prompted a physician to email me with his take on this matter. I am going to quote from that email, but take out identifying information to protect his anonymity.
Here’s what he said:
I had the experience of dealing with Medi-Cal (California’s name for its’ Medicaid plan) in the early 90s when I had started a primary care solo practice. Of 40 primary care docs in a 3 mile radius of my office, I was one of three who accepted Medi-Cal.
The payment for any office visit was so low that it bordered on punitive. The state paid approx 1/3 of the average commercial rate at that time and actually decreased the rate and payment over the past 20 years. California, perhaps not unique compared to all states, also had a nasty habit of stopping payment for any Medi-Cal billed services when the budget for that year ran out, even if that was after 7-8 months. Practices that absolutely depended on Medi-Cal reimbursement went unpaid until the start of the next fiscal year, at which time the backdue payments would trickle in until the next stoppage.
I understand that politics is a messy business, and that government spending can be unpredictable. And I realize that in the real business world, the ins and outs of money are often unpredictable, too. But when someone says they’re going to pay you for the service you provide, that payment should be timely and appropriate. Far too often, state Medicaid programs fail on both accounts.
One of the ironies here is that Medicaid does a much worse job of reimbursing services, and doing so in a timely manner, than does Medicare. This kind of puts the normal state versus federal efficiency debate on its head. Usually, the more local entity should be nimbler and more efficient than the big clunky federal one. But in this case, the federal Medicare program wins handily. I expect the poor performance of state Medicaid programs results, in part, from the greater financial pressures states face, year in year out. Most states are required to have balanced budgets, while the federal government is not.
As a fiscal moderate, I like the idea of making sure that government spending doesn’t far outstrip government revenue. However, the benefits of completely balanced government budgets are often overstated. As long as government budgets are relatively close to being in balance, governments should have the flexibility to overspend on some programs, rather than create financial trouble for people who have done work for the government and who deserve to be paid for that work. As I’ve written earlier, I think we would be better off federalizing Medicaid. That won’t solve all our problems, by any means. But I expect such federalization would have improved this physicians’ experience caring for low income patients in California.
Both doctors and patients deserve better than what too many Medicaid programs give them.
Peter Ubel is a physician and behavioral scientist who blogs at his self-titled site, Peter Ubel and can be reached on Twitter @PeterUbel. He is the author of Critical Decisions: How You and Your Doctor Can Make the Right Medical Choices Together. This article originally appeared in Forbes.