A Closer Look at Discrepancies in Medicaid Reimbursements

In the February 7, 2018 issue of The Journal, Lalezari et al. provide a detailed analysis of the variability in state-based Medicaid reimbursements to physicians for 10 common orthopaedic procedures, including hip and knee replacement and 5 spinal surgeries. The discrepancies in reimbursements between states, even bordering states in the same geographic region, are substantial and do not seem to follow any pattern. This phenomenon of reimbursement variability has been mentioned in podium presentations and some less comprehensive reports in the past. However, the authors of this study used a careful, methodological approach to accurately report these differences in a manner that is easy for readers to understand.

There is simply no way to rationalize this degree of variation in Medicaid reimbursement; the magnitude cannot be explained by differences in workload or practice costs because Lalezari et al. adjusted for cost of living and relative value units (RVUs). Nor does Medicaid-reimbursement variability seem to be related to Medicare reimbursement rates, as some states had Medicaid reimbursements that were higher than Medicare reimbursements for all procedures analyzed.

The orthopaedic community should not react directly to the reimbursement discrepancies presented in this article. Rather, orthopaedic surgeons, health system administrators, and patients alike should bring the variability of Medicaid reimbursements to the attention of state and federal policy makers.

Alas, I am not optimistic that this issue will gain a lot of traction given the long list of healthcare-related issues currently on the desks of state and federal lawmakers. Moreover, as the authors mention, these state-based reimbursement rates are likely related to many variables, and Lalezari et al. further observe that “health policy intended to improve access to specialty care should not solely focus on physician reimbursement.” However, consistent communication with elected officials to help explain the impact that these variable rates can have on patient care, accompanied by updated studies like this one every 2 to 4 years, would seem to be a rational response to these data.

Marc Swiontkowski, MD
JBJS Editor-in-Chief

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