Obama 2015 Budget Would Extend Medicaid Pay Bump

Abstract

Many physicians would continue to see higher payments through 2015 for treating Medicaid ­patients under President Obama's proposed budget for the upcoming fiscal year. The budget request submitted to Congress March 4 includes $5.4 ­billion to extend the Affordable Care Act (ACA) provisions that pay physicians at Medicare levels for certain primary care services to Medicaid patients. Otherwise, the increase will end this year. Under the budget proposal, nurse practitioners and physician assistants also would be eligible for the higher payment rates. “Allowing [the higher rates] to expire would result in a deep, across-the-board cut to primary care physicians who are taking care of the most vulnerable populations, at a time when millions more are becoming eligible for Medicaid,” Molly Cooke, MD, president of the American College of Physicians (ACP), said in a statement. The budget proposes $77.1 billion in discretionary spending for Health and Human Services (HHS), down $1.3 billion from 2014. This includes investments in the primary care workforce, expanded mental health services, and continued implementation of the ACA insurance marketplaces. The president's budget also calls for Medicare cuts of more than $400 billion over 10 years. Proposed in previous budgets, these include payment cuts for inpatient rehabilitation facilities, long-term care hospitals, and home health agencies; reduction in Medicare coverage of hospitals’ bad debts; reductions to indirect graduate medical education payments; and payment cuts to critical-access hospitals. In addition, the budget would introduce readmission penalties for skilled nursing facilities and strengthen the controversial Independent Payment Advisory Board (IPAB). The proposal would require the IPAB to recommend cost-cutting targets to Congress if the Medicare growth rate exceeds gross domestic product plus 0.5 percentage points. Current law sets that level at GDP plus 1 percentage point. The 2015 budget proposal would increase investment in the primary care workforce. It requests more than $5 billion over the next decade to train 13,000 new residents as part of a new competitive grant program available to teaching hospitals, children's hospitals, and community-based consortia of teaching hospitals or other health care institutions. The budget also beefs up funding for the National Health Service Corps. It includes nearly $4 billion in new funding over 6 years to increase the number of health providers in rural areas and federally funded health centers to 15,000. And it would invest $4.6 billion in community health centers in 2015 and another $8.1 billion for the next 3 years. For mental health services, the budget includes $55 million for Project AWARE, which encourages community and school officials to work together to keep schools safe, refer students to mental health services, and provide mental health “first aid” training so that teachers can detect early signs of mental illness. The budget request includes $50 million to train about 5,000 new mental health professionals, $20 million to help young adults aged 16-25 years navigate behavioral health services, and $5 million to change attitudes about people who have behavioral health needs in the workplace. The budget also provides funding for a demonstration project in Medicaid to help reduce the use of psychotropic medications prescribed to children in foster care by improving access to other mental health services. The release of the president's budget request came just weeks before the end of open enrollment in private health plans through the ACA's marketplaces. The budget includes $1.8 billion in funding for 2015 to cover the cost of running the federally facilitated marketplace. However, most of the funding – $1.2 billion – would be covered by user fees from health plans in the marketplaces. If Congress fails to provide the remaining funds, HHS officials said they could transfer monies from other agency accounts to cover marketplace costs.