(The Center Square) − The Louisiana Senate Committee on Health and Welfare will review a new plan submitted by the Louisiana Department of Health on Tuesday to revamp reimbursement rates for public health care services, including Medicaid.
The proposed changes aim to tackle systemic challenges in health care access for the state’s Medicaid population.
A key feature of the proposal involves aligning Medicaid reimbursement rates with those of Medicare, a significant shift from the current structure. Health department Secretary Michael Harrington explained that Medicaid recipients often face difficulties accessing care despite having coverage, a gap the department aims to bridge with the new plan. “Having coverage under Medicaid does not mean you have access,” Harrington said.
Under the proposed changes, the Medicaid fee schedule would be increased to 85% of Medicare rates in the first year and rise to full parity with Medicare in the second year. Nurse practitioners, categorized as mid-level providers, would see their reimbursement rates increase from 80% to 85% of physician rates by the second year.
The funding model relies on hospital assessments and contributions from managed care organizations, with no dependence on state general funds. In the first year, the plan is projected to cost $258 million, with $57.8 million provided by state and federal funding. The second year’s cost is estimated at $518 million, supported by $116.1 million in matching funds.
Harrington noted that the current reimbursement structure forces hospitals to subsidize specialist coverage for emergency room calls. By raising reimbursement rates, the health department hopes to reduce these subsidies, ensuring better specialist availability and improving overall care coordination.
The proposal also includes introducing case coordination codes to Medicaid, modeled after strategies in other states that have demonstrated success in improving access and outcomes for Medicaid populations.
The health department plans to enact pilot projects in regions four and five to address frequent emergency department visits caused by a lack of coordinated care. These pilots aim to redirect patients to more cost-effective office visits and clinics while providing better follow-up care.
The plan has garnered support from medical professionals, including Dr. Joseph Bocchini, Jr., president of the Louisiana chapter of the American Academy of Pediatrics.
“Improvement in payment rates will have a significant impact on access to pediatric care and will result in improved outcomes for the children of our state,” Bocchini said. He highlighted that increasing Medicaid reimbursement rates could reduce school absences due to chronic diseases like asthma and lower avoidable emergency room visits.
Studies cited by Bocchini show that raising Medicaid reimbursement rates improves access to care, including a 14% reduction in school absences among Medicaid recipients and a decrease in low-acuity emergency department visits. He emphasized that equitable payment structures are essential for sustaining pediatric practices and addressing health inequities.
As the committee reviews the plan, its implications could be far-reaching for over 1.7 million Medicaid enrollees in Louisiana.
