Kaiser Releases Two Reports on Medicaid Reimbursement Rate Increases

By Wesley Prater

See CCF’s latest fact sheet on Medicaid Access

Thanks to the Affordable Care Act, Medicaid reimbursement rates will increase to at least 100% of Medicare rates in the 2013 and 2014 calendar years.  The federal government will fund 100% of the difference in cost between what a state’s Medicaid rate was on July 1, 2009 and the applicable Medicare rate.  My colleague, Tricia, has blogged about this topic before, but I wanted to also mention two papers released by the Kaiser Commission on Medicaid and the Uninsured.

The first brief offers a state-by-state analysis of Medicaid fees and how these compare to Medicare fees.  It also examines how Medicaid fees have changed over time and how the increase will affect each state in 2013.  It is estimated that Medicaid fees will increase by an average of 73% in 2013, but the impact will vary among states.  For example, six states (California, Florida, Michigan, New Jersey, New York, and Rhode Island) will more than double their current rates, while nine states will have fee increases of less than 25%.  Only two states (Alaska and North Dakota) will not be impacted, as their Medicaid fees are already above Medicare levels.

The second brief gives an overview of this ACA provision and a great summary of the Final Rule that was released by CMS on November 6, 2012.  These briefs may serve as useful tools for your state in the upcoming year.

As states extend Medicaid to 133% of the federal poverty level in 2014, there will undoubtedly be a greater demand for Medicaid providers.  This upcoming rate increase will help states move in the right direction to support and improve provider participation in Medicaid.