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For Some Newly Insured Vermonters, Doctors Are In Short Supply

Fewer Vermonters than ever are without insurance, thanks largely to a recent expansion of Medicaid. But just because low-income residents have insurance doesn’t necessarily mean they’re having an easier time finding a doctor.

Over the past year or so, tens of thousands of Vermonters have become newly eligible for Medicaid. The surge is a result of the federal Affordable Care Act, which expanded the income levels needed to qualify for the government program.

But there’s one big problem with Medicaid: It only pays doctors about 60 percent of what it costs to care for a patient. And it’s created a disturbing dilemma for many primary care doctors: Turn away Medicaid patients, or suffer financially for taking them on.

“Do you really want doctors answering the phone at their practice ... and caring, literally to the point of their own survival, what insurance you have before they’re willing to see you?” says Al Gobeille, chairman of the Green Mountain Care Board.

"Do you really want doctors answering the phone at their practice ... and caring, literally to the point of their own survival, what insurance you have before they're willing to see you?" - Al Gobeille, Green Mountain Care Board chairman

Gobeille heads the five-person panel that oversees private insurance rates and hospital budgets, and he’s among the policymakers sounding the alarm over low Medicaid reimbursement rates.

Lawrence Miller, chief of health care reform for the Shumlin administration, says physicians practicing in regions that can least afford the problem are the ones affected the most.   

“Those people who are working, particularly in rural communities with high Medicaid populations, they’re just finding it really challenging,” Miller says. “And if you’ve got a higher-than-average percentage of Medicaid patients, you’re in a tough spot.”

Health care advocates heralded the Medicaid expansion in the ACA. In Vermont, more than 87,000 adults and children are getting Medicaid now than were 16 months ago, an increase of nearly 70 percent, according to the federal website,

The ACA included a temporary bump in Medicaid reimbursement rates, designed to get doctors to actually serve those new patients. That temporary bump, however, has since expired.

“Last month, those payments sunsetted, such that all those practitioners who were seeing those new Medicaid patients, took a 20- to 21-percent cut in their Medicaid payments,” says Dr. Paul Reiss, a primary care doctor at the Evergreen Family Health clinic in Williston.

"Those people who are working, particularly in rural communities with high Medicaid populations, they're just finding it really challenging." - Health care reform chief Lawrence Miller

Reiss says the drop in Medicaid reimbursements has hit independent doctors especially hard, because they can't offset the lost revenue by increasing costs on privately insured patients.

“And it’s something that goes directly to the financial well being of that practice, and ultimately to the ability for that practice to pay its staff and continue to pay its overhead expenses,” Reiss says.

Gov. Peter Shumlin has proposed a new $90 million payroll tax, the bulk of which he wants to use to increase rates paid to doctors and hospitals that treat patients on Medicaid. The Department of Vermont Health Access sets Medicaid reimbursement rates. If the state doesn’t come up with the additional funding, then the situation is only going to deteriorate.

“If you don’t give DVHA budget adjustment, and you don’t pay for it somehow, and you don’t do an increase next year, DVHA’s only tool is to do it in rates,” Miller says.

Miller says Shumlin likely won’t allow that to happen. But if lawmakers don’t approve the revenue planoffered by the governor, or come up with one of their own, then elected officials will have to cut drastically from other areas of the budget in order to increase Medicaid rates.

House Speaker Shap Smith says he has concerns about the impact of the payroll tax on the economy. But he says he’s convinced that low Medicaid rates are preventing patients from gaining access to primary care doctors. And he says he lawmakers must act soon to boost reimbursement levels.

The Vermont Statehouse is often called the people’s house. I am your eyes and ears there. I keep a close eye on how legislation could affect your life; I also regularly speak to the people who write that legislation.
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