Disparity in Medicaid physician payments for vascular surgery

Objective: Medicare reimbursements are standardized nationwide on the basis of resource-dependent inputs of physicians' time, intensity, practice costs, and malpractice costs, whereas Medicaid payments vary and are determined by individual states. Our objectives were to determine Medicaid reimbursement to physicians for common vascular procedures for the seven states in the Northeast that compose the New England Society for Vascular Surgery and to compare Medicaid payments with Medicare. Methods: Using publicly available data, we obtained Medicaid physician payments in Connecticut, Massachusetts, Maine, New Hampshire, New York, Rhode Island, and Vermont for 10 commonly performed vascular surgery procedures. For comparison, Medicare physician payments for these procedures were adjusted for regional differences using Medicare geographic payment cost indices. Descriptive statistics were calculated by state; Wilcoxon signed rank test was used to compare fees, and one-way analysis of variance was used to compare variance. Results: Medicaid payments varied widely by state. Within individual states (except Vermont), there was no relationship between Medicaid and Medicare payments. Medicaid reimbursement for common vascular procedures ranged from 25% to 91% of Medicare rates and had up to a threefold variation in payment among states for a single procedure. The mean Medicaid payment was 60% of Medicare payment. The greatest state-to-state variance in payment was for open abdominal aortic repair (standard deviation, $227.31); the least was for femoral artery exposure (standard deviation, $31.86). For a Medicaid-based, frequency-weighted analysis of services, New Hampshire exhibited the lowest payments (43% Medicare) and Vermont the highest (80% Medicare). Conclusions: Among the seven Northeast states considered, with the exception of Vermont, there is no logical relationship between Medicaid and Medicare payments. Because Medicare payments are determined by the Centers for Medicare and Medicaid Services with consideration of resource-based inputs, we conclude that in six of the seven states, Medicaid payments bear no relationship to resource utilization. With Medicaid expansion, access to vascular procedures may be limited by payments insufficient to meet resource needs.