Association for Public Policy Analysis & Management

Medicaid insured women have low rates of cancer screening, in spite of the access to care Medicaid affords. One potential barrier to accessing important preventive services for women enrolled in Medicaid is low physician payment rates. In most states, Medicaid reimburses physicians at substantially lower rates than do Medicare or private insurers. Lower Medicaid rates are associated with lower physician acceptance of Medicaid patients, shorter physician visits with Medicaid patients, and fewer ambulatory care visits by Medicaid enrollees. Few studies have specifically examined how Medicaid payment rates affect the provision of preventive care, and findings from these studies are mixed. The issue of Medicaid physician payment is particularly timely given state policy debates over whether and how long to extend Medicaid primary care payment rate increases implemented under the Affordable Care Act (ACA) in 2013 and 2014.

This study examines the relationship between Medicaid physician payment rates and utilization of breast and cervical cancer screening among non-elderly non-disabled Medicaid enrollees prior to implementation of the ACA. Data on the use of screening services come from the Medicaid Analytic eXtract (MAX) files for 2003 and 2008-2011. MAX data contain enrollee-level information on eligibility, demographics, managed care (MC) enrollment, fee-for-service (FFS) claims and MC encounter data. We use information from diagnosis and procedure codes to examine breast and cervical cancer screening. Data on state Medicaid physician fees come from a survey of states conducted by the Urban Institute. We use data on states’ Medicaid fees relative to the national Medicaid average and a Medicaid-to-Medicare fee ratio for 2003, 2008, and 2012. We conduct analyses using data from 2003 and 2008 and using all available years of MAX data, assuming a linear trend in payment indices in years for which we do not have payment rate data. We conduct analyses both with and without MC enrollees included in the sample. We estimate state and year fixed effect models to assess the impact of changes in the fee index on utilization of screening services.

We find that screening rates are low in the Medicaid population. Our initial results indicate that in cross-sectional analysis, higher payment rates are associated with greater utilization of breast and cervical cancer screening. In state and year fixed effects models, though, we find that increases in payment rates are associated with lower utilization of both breast and cervical cancer screening. In contrast, across all models we find that enrollment in comprehensive managed care is associated with higher utilization of screening. These preliminary results suggest that higher payments alone may not be a sufficiently strong incentive for physicians to provide more preventive services such as breast and cervical cancer screening. In contrast, managed care may play an important role in promoting use of preventive services. Our results have important implications for states considering how to improve quality of care for their Medicaid beneficiaries.  Our findings also provide insight into how to best structure Medicaid reimbursement rates and care delivery to meet patient needs.