A proposed CMS rule published in May would reduce Medicaid spending by more than $775 billion over 10 years, a figure that has dominated hospital finance conversations for weeks.
Although Medicaid populations skew toward hospital-based care, and most ASC payer mixes are weighted toward commercial insurance and Medicare, many ASCs will still be affected.
Medicaid patients are not evenly distributed across ASC specialties. GI procedures, including colonoscopies and upper endoscopies, carry meaningful Medicaid volume in states with expanded programs, according to data from MedPAC. Pain management and interventional pain procedures draw from populations with higher rates of Medicaid coverage. Orthopedic cases, while more commercially weighted at the high end, include a segment of Medicaid-covered patients in certain markets, particularly for younger patients with trauma or injury-related needs.
“Proposed Medicaid cuts could impact ASCs and a multitude of other healthcare delivery settings,” Les Jebson, regional administrator at Greenville, N.C.-based Prisma Health, told Becker’s. “There are always concerns with potential changes from any payers. Data analysis of historical volume trends by procedure and payer allow us to anticipate the fiscal impact of any payer changes, including Medicaid.”
The exposure is geographic as much as it is clinical. ASCs in states that pursued aggressive Medicaid expansion under the ACA, and that have built payer mixes that reflect those populations, such as California, face a different calculus than centers in non-expansion states where Medicaid volumes were already lower.
“We live in an area of California that has a large population of patients that depend on Medi-Cal services,” Suzi Cunningham, administrator of Advanced Ambulatory Surgery Center in Redlands, Calif., told Becker’s. “There is concern that if these patients lose coverage, they will stop seeking out care. Or those that seek care, will be unable to afford their patient responsibility, or will be uninsured. Ultimately, it is too soon to tell.”
Even ASCs with minimal direct Medicaid volume could face indirect exposure. Patients who lose Medicaid coverage do not stop needing GI, orthopedic or pain procedures. They often show up uninsured, with reduced ability to pay, or they may delay care until it becomes more acute and more expensive.
“Medicare and Medicaid rates are already unsustainably low,” Cory Maxwell, MD, of Charlotte, N.C.-based Providence Anesthesiology Associates, told Becker’s. “This system forces commercial payers to subsidize government payers, leaving practices highly sensitive to shifts in payer mix.”
The proposed rule includes a 60-day comment period. The American Hospital Association said it plans to issue a regulatory advisory to members detailing the proposal.
The Federation of American Hospitals also urged CMS to work with hospitals as it advances the proposal.
“Patients rely on their local hospital to be there for them whenever they need care,” Charlene MacDonald, president and CEO of the Federation of American Hospitals, said in a statement. “A strong, sustainable Medicaid program is essential to maintaining that commitment, especially in rural areas where hospitals are often the largest employer and the only source of care for miles, and state directed payments are a critical part of that equation.”
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