HHS proposes rule to pay Medicaid at higher Medicare rate

Published on: 

You may clamor for Medicaid patients if a rule proposed by the U.S. Department of Health and Human Services passes muster. Find out who foots the $11-billion bill.

You and your fellow primary care physicians (PCPs) could see a temporary boost in Medicaid payments starting in 2013 under a new rule proposed by the U.S. Department of Health and Human Services (HHS).

The proposed rule, announced May 9, would implement a requirement in the Patient Protection and Affordable Care Act (PPACA) that mandates Medicaid reimbursement of family medicine, general internal medicine, pediatric medicine, and related subspecialists at Medicare levels in 2013 and 2014.

HHS Secretary Kathleen Sebelius says states would receive a total of more than $11 billion in new funds from the federal government-with no state matching required-to bolster their primary care delivery systems. More than150,000 PCPs nationwide received more than $560 million in higher Medicare payments in 2011 thanks to the PPACA, Sebelius adds.

“The payment…will be an important tool for states to ensure their primary care networks are prepared for increased enrollment as the healthcare law is implemented,” says Marilyn Tavenner, acting administrator for the Centers for Medicare and Medicaid Services (CMS). “[The proposed rule] will help encourage [PCPs] to continue and expand their efforts to provide checkups, preventive screenings, vaccines, and other care to Medicaid beneficiaries.”

Comments on the proposed rule will be accepted through June 8. The Federal Register notice can be found at

HHS also announced new finalized rules that Sebelius says will cut red tape for providers and hospitals, saving nearly $1.1 billion across the healthcare system in the first year and more than $5 billion over the next 5 years.

The Medicare Regulatory Reform rule will save $200 million in its first year by promoting efficiency through the elimination of duplicative, overlapping, and outdated regulatory requirements for healthcare providers, according to HHS. Another rule revises the Medicare Conditions of Participations for hospitals, with a projected savings of $940 million annually. The new rules also will allow providers to partner with critical access hospitals to increase efficiency and timely care for patients.

The final rules can be found at

Also, HHS announced a series of Health Care Innovation awards supporting 26 projects nationwide that promise to save money, increase the quality of medical care, and enhance the healthcare work force.


Preliminary awards total $122.6 million and aim to save $254 million in health spending over the next 3 years, according to HHS. The initiative awards applicants that develop ways to increase the efficiency, quality, and affordability of healthcare, such as Emory University’s collaboration with area health systems to train health professionals and use telehealth technologies to link critical care units in rural Georgia to critical care physicians in Atlanta. A full list of awardees can be found at

Go back to current issue of eConsult

Related Content

Antitrust laws: Hurting healthcare reform?

Healthcare reform law could lead to PCP shortfall for Medicaid patients

Medicaid prices, volume of services vary widely

Can providers sue states to block Medicaid cuts? Supreme Court hears arguments