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ACA targets better reimbursement for physicians
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As more terms of the Affordable Care Act are implemented, more children will become eligible for health care than ever before.
“We are likely to see a decrease among the number of uninsured children by about 40%, even though we’re already at a historic low pediatric uninsurance rate,” said
In 2010, the Patient Protection and Affordable Care Act, now commonly known as the ACA, extended coverage for all adults younger than 26 years to stay on their parent’s insurance plan.
Brian Berman, MD, of Beaumont Children’s Hospital and Oakland University William Beaumont School of Medicine, said some physicians may be reluctant to increase their load of Medicaid patients.
Photo courtesy of Berman B
"Some of my older adolescents, young adults, mothers and fathers who come into the office have had absolutely no insurance coverage,” said Block, who is also a member of the Infectious Diseases in Children Editorial Board. “We were always trying to figure out how to get them into my office, any office, and how to get them medication, and now those issues should be resolved, to a reasonable degree. The increased reimbursement and the increased patient coverage, respectively, should be a godsend to our practice and to this population, whom I see every day as a patient or a parent in the office.”
Infectious Diseases in Children spoke with experts in the field about the basic principles of the ACA and its implications for practicing pediatricians.
Insurance coverage
With the changes, nearly everyone is expected to secure coverage for themselves and their families through an employer, a public program or insurance plans offered in the new state-based exchanges. Open enrollment in the health insurance marketplace began Oct. 1. These exchanges are designed to provide uninsured, and in some cases underinsured, individuals and small-business owners with the ability to purchase affordable health insurance coverage for themselves and their employees.
The options for insurance coverage, according to the HHS website, include the following:
- A government-sponsored health plan, such as Medicare, Medicaid, CHIP, Veterans Administration or TRICARE.
- An individual or family plan through an employer, including through an exchange.
- A plan purchased in the individual insurance market, including through an exchange.
“With the role out of the exchanges and more affordable plans, additional kids who may not have qualified for Medicaid but who may have previously been on CHIP, but aren’t able to be on a family policy, will have more options,” he said. “The exchange may allow for policies that are a little more robust and provide better coverage and benefits.”
Medicaid and CHIP
In January, Medicaid income eligibility will be extended to all children and adults up to 133% of the federal poverty level, meaning $29,327 for a family of four and $14,404 for an individuals according to the AAP website.
CHIP funding also has been extended until Sept. 30, 2015. According to AAP, the law will provide “continued federal funding for Medicaid and CHIP enrollment and renewal activities, which, when added to previous funding, creates a total $140 million for these funds through 2015.”
Hall said AAP is trying to get reauthorization of CHIP extended to make sure there is no reduction in children’s insurance coverage once the extension ends, but nothing is final yet.
“If you look at Congressional Budget Office projections, CHIP enrollment is expected to plummet from 12.8 million children in 2015 to 4 million or so in 2016,” he said. “Some of those kids will go into exchange coverage but we are nervous that you will see a decrease in kids’ coverage after the extension ends. Reauthorizing the CHIP block grant for a few more years shores up coverage.”
Hall said Medicaid and CHIP enrollment has been increasing as more people lose their employer-based insurance.
“Medicaid and CHIP specifically catch those kids when their parents lose their employer-based insurance, and so, right now, we’ve got around 92% of the kids covered in the United States,” he said. “That’s different from the adult population, proving Medicaid and CHIP do what they’re supposed to.”
In April, the AAP Committee on Child Health Financing updated its Medicaid policy statement to reflect changes once the ACA is implemented.
Walter A.
Orenstein
The statement notes that by 2019, under the terms of the ACA, 16 million people could gain insurance through Medicaid and CHIP.
“Not simply because of reimbursement, but because, in some instances, underserved patients may impose certain challenges that a private practitioner may be ill-equipped to address. I am referring to health-related variables that are related to the social matrix. A lot of physicians in a practice setting, with no social workers and limited ancillary support, are concerned about that,” he said.
Physician reimbursement
Beginning this year and running through 2014, federal funding of $13 billion is being provided to states to bring Medicaid payments to at least that of Medicare. The increases only apply to payments for evaluation and management codes and immunization administration codes and will be available for physicians with an internal medicine, family practice or pediatric primary specialty.
“Pediatricians are different than adult doctors in that Medicaid pays about two-thirds of what Medicare has historically paid,” Hall said. “What we’ve been able to document is that low payment rates mean it’s hard for a pediatrician’s office to see all of the kids on Medicaid that they want to. By raising payment rates to 100% of Medicare for 2 years, at least for some services and doctors, you’re able to address some of the access issues.”
Simon said the Medicaid increase also could help give incentive to physicians to see more of the children in the program by making it financially feasible.
“That will also, in turn, improve access and, hopefully, people will continue to see children who have Medicaid because it’s not a money losing proposition where you’re subsidizing out of your own pocket or with other patients who have their own personal insurance,” he said. “The problem though is that, right now, it’s only written for 2 years. Hopefully, in 2 years we’ll have information to show that this is something that is a good investment for the health of the children to improve access and get things done; it’ll pay for itself over time.”
Vaccines will be covered
According to
“In other words, both the vaccine cost and administration cost should be covered for someone who seeks care under an in-network provider,” he said. “The vaccines that are covered are those that are on the Advisory Committee on Immunization Practices schedule. It does not cover vaccines that are not on the schedule, such as travel vaccines.”
Services also have to be provided without co-pays or deductibles so immunizations by an in-network provider results in no out-of-pocket cost for the patient.
Orenstein said this aspect of the ACA is a good change and if fully implemented can help remove financial problems as barriers to access.
However, plans beginning before March 2010 are not required to cover vaccine cost and administration.
“This is a great way to try and resolve financing problems,” he said. “The other good thing is that for people who have been underinsured, their vaccine cost and administration costs are now covered, provided they enter plans that are new or have changed since March 2010.”
According to Orenstein, the federally funded Vaccines for Children (VFC) program will remain unchanged in terms of providing free vaccines through Medicaid or to uninsured children.
“Theoretically, the only underinsured children would be those with grandfathered plans (plans unchanged since before March 2010), but they still can get free vaccines under VFC if they seek care at a federally qualified health center,” he said. “The VFC program is available in each state. The hope is eventually that VFC will only need to provide free vaccines for children enrolled in Medicaid, since eventually almost all other children will be covered by plans that are required to provide vaccines free of charge to children seeking care at in-network providers.”
The Immunization Grant Program (Section 317) also remains a crucial part for immunization practices, according to Orenstein.
“There is nothing in the act that specifies the need for or levels of 317 funding,” he said. “Section 317 is critical because it helps in doing things like surveillance, vaccine education, adverse event surveillance, outbreak investigations, control, and all sorts of critical activities that are simply not covered by insurance. One of the great concerns is that legislators may get confused and think that 317 is no longer needed because vaccines and their administration are covered by private insurance. That’s not the case; 317 funding is absolutely needed to cover the public health functions that are required for an optimal immunization program.”
According to Simon, under the ACA, individual state caps for vaccine administration were adjusted upward to better reflect the current costs of providing immunizations. States can now pay either the Medicare rate or the state cap rate, increasing rates to $20 per administration. Most states have been paying in the $8 to $12 range.
“All of a sudden, you have places that used to pay a low amount on straight Medicaid getting up to the range of $20,” Simon said. “That’s what it costs to do these immunizations. All of a sudden, you have people being able to see more of these kids. That’s part of the incentive for improving health for kids, improving access, making things workable and doable, and helping the bottom line for pediatricians. Overall, as pediatric communities, [we’re] able to provide better preventive care for kids.”
Minimum standard to meet
The ACA also requires that any plan offered in the exchanges will have to meet a minimum standard to provide hospitalization; ambulatory patient services; emergency services; maternity and newborn care; mental health and substance use disorder services, including behavioral health treatment; prescription drugs; rehabilitative and habilitative services and devices; preventive and wellness services; chronic disease management; and pediatric services, including oral and vision care.
“With the addition of oral and vision care for pediatrics, there’s a specific recognition that kids need something different than adults,” Hall said. “They need to be able to read the blackboard. They need to go to school without dental pain. There are a lot of elements needed by children that are not often included in private sector insurance, which is usually based off of adult care.”
General pediatrics vs. subspecialists
Another area of the ACA that could highly benefit pediatricians is the possibility of loan repayment for those medical students pursuing a full-time career in a pediatric medical subspecialty, pediatric surgical specialty, or child and adolescent mental and behavioral health care field, paying up to $35,000 a year for 3 years. However, this has yet to be funded.
Hall said this, if funded, could possibly bring subspecialists out to the more rural areas.
“We’re never going to be able to fully fill the gap in terms of how much workforce we really need, but our problem is not as significant on the primary care side, it’s much more significant on the subspecialty side,” he said.
Simon, however, said this type of program is looking less than optimal, and with the recent government shutdown, the possibility for it is looking bleak.
“Furthermore, even if funded, the low payment rates for Medicaid, as well as the professional stress of practicing in an underserved area, imagine being the only pediatric neurologist in a 250-mile radius, make this type of program less than ideal,” he said.
AAP. Health Reform and the AAP: What the New Law Means for Children and Pediatricians. Available at: www.aap.org/en-us/advocacy-and-policy/federal-advocacy/Documents/ACAImplementationFactSheets.pdf. Accessed Aug. 10, 2013.
AAP Committee on Child Health Financing. Pediatrics. 2013;doi:10.1542/peds.2013-0419.
Key Features of the Affordable Care Act by Year. Available at: www.hhs.gov/healthcare/facts/timeline/timeline-text.html. Accessed Oct. 9, 2013.
Robert Hall, JD, MPAff, can be reached at 601 13th Street, NW Suite 400N, Washington, DC 20005; email: RHall@aap.org.
Geoffrey Simon, MD, is the physician in charge at Nemours duPont Pediatrics in Wilmington, Del.
Stan L. Block, MD, FAAP, can be reached at slblockmd@hotmail.com.
Brian Berman, MD, can be reached at brian.berman@beaumont.edu
Walter A. Orenstein, MD, can be reached at worenst@emory.edu.
Disclosures: Hall reports being associate director of federal affairs for AAP. Berman, Block, Orenstein and Simon report no relevant financial disclosures.
Will the ACA negatively affect private pediatric practitioners?
ACA benefits child population.
To begin with, it is important to note that the voice of pediatricians as spoken politically has always been supportive of federal and state involvement in children’s health. It is in our DNA, and some of our pediatric heroes have been national leaders in such efforts. For nearly 100 years, pediatricians have gone on record to support government-supported maternal and child health centers in the 1920s, the Head Start program in the 1960s, and both President Clinton’s Health Security Act of the 1990s and President Obama’s Affordable Care Act (ACA) of 2010. Despite the current demonization of the ACA that is playing itself out in Congress, organized pediatrics has been a strong supporter of the ACA.
William T. Gerson
Why is the support so strong? Children are the most vulnerable portion of our population. Nearly one-quarter of our children are living below the federal poverty level, and childhood poverty persists largely unchanged since I was a high school student in the 1970s. Despite children being our future, federal support of programs for children is disproportionally low. For those of us who practice office-based pediatrics, the struggles of families with children are our onus and we strive to improve all of their futures. The ACA is a critical step in the improvement of the lives of our children by mandating access to care, age-appropriate benefits and insurance coverage. There is guaranteed coverage of children with pre-existing conditions and elimination of lifetime limits on benefits as well as the ability of insurers to drop coverage because of illness.
We will argue in the future over changes to the ACA. Although the federal level is paralyzed, state systems will likely be the drivers of innovation from single-payer initiatives to defining the levels of services covered by plans. The complexity of the terminology is staggering – EPSDT (early and periodic screening, diagnosis, and treatment), CHIP (Children’s Health Insurance Program), EHB (essential health benefits) – and as with government-defined programs in general, the economic future of pediatric practice is in the details. The standard level of reimbursed services for children will likely be better than the commercially driven EHB standard but not as favorable as the Medicaid-defined EPSDT. However, the recent increase in Medicaid payment rates to at least the Medicare rates for primary care and immunization services has been an important improvement to pediatric practices. In most pediatric practices, as is true of mine, an average of 20% to 30% of our patients are covered by Medicaid.
Private pediatric offices are also small businesses. As community pediatricians, we need to understand the implications of the ACA as employers. Although challenging, providing our employees, as well as ourselves, with health insurance has always been difficult. Our current ACA health insurance exchange in Vermont has been easy to navigate, and the plans are considerably less expensive than our past options. My first impression is that the ACA will allow my small office to be more competitive in hiring with the larger hospital-based systems. For once, as a small business, I will be able to offer plans that can attract skilled employees on a more level playing field. Obviously not limited to medical practices, the ACA should be a shot in the arm to all small businesses and startups.
William T. Gerson, MD, is with the Department of Pediatrics at the University of Vermont College of Medicine. Disclosure: Gerson reports no relevant financial disclosures.
Pediatricians have soft hearts vs. one heart.
The only possible downside is that there could be some practices that become overwhelmed with the number of patients who never had insurance before but now do, thanks to the ACA. The doctors in town who had closed their practice to Medicaid previously because they couldn’t take anymore, may now be swamped with all of these patients who didn’t have insurance previously. Will we have a doctor shortage? I think we will in certain geographic areas. It’s also going to be a problem for pediatric subspecialists. If the system is going to be flooded now, that can be an issue for them.
Richard Lander
It doesn’t appear that the ACA will have much of an impact on coding issues. For 2013-2014, Medicaid will be paid at Medicare rates, which is absolutely terrific for all of those doctors who have been taking care of these huge Medicaid populations and have been vastly underpaid. There are certain codes that Medicaid doesn’t pay that private insurance does pay, which would be an issue — but the ACA is going to be taking people out of that whole Medicaid world and throwing them into these insurance exchanges if they make enough money. If they do not make enough money, they will get subsidies from the federal government. That shouldn’t be an issue. It is a positive thing that more people will be able to have insurance. There will be more people coming into the regular system.
We know that we have had complaints about Medicaid in general because it doesn’t pay enough, but if it pays well, the doctors will take the children. Pediatricians have a soft heart, so they do it.
It’s a plus that young people up to age 26 years can be covered under their parents’ insurance.
Richard Lander, MD, is a pediatrician in private practice in northern New Jersey. Disclosure: Lander reports no relevant financial disclosures.