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Physicians Billing Complexity - Medicare v/s Medicaid

January 25, 2016

Physicians Billing Complexity - Medicare v/s Medicaid

With the Affordable Care Act (ACA) or Obamacare coming into effect, a lot of changes were brought into how the government health insurance programs would function which have affected reimbursements to physicians. The government health insurance programs, popularly known under the common name, Center for Medical Services (CMS) covers both Medicare as well as Medicaid health insurance programs. Simply stated, Medicare is the primary payer and is for the elderly, senior citizens, disabled people, whereas, Medicaid is the secondary payer and covers the low-income groups.

Healthcare Providers need to be aware of certain underlying and subtle points when processing the Medicare and Medicaid billing of patients who are covered by these programs

  Medicare Medicaid
Finance Medicare covers around basically 80 percent of the cost of service and the 20 percent co-insurance or deductible is borne by Medicaid Medicaid is jointly funded by federal and state money, in actual fact each state sets its own guidelines and is thus a state-administered program
Insurance coverage Insurance coverage of patients under need to be noted Doctors who participate in Medicaid cannot bill a patient anything extra than what they have given the service for
Eligibility Some people with Medicare are also eligible for Medicaid, and Medicaid offers them programs that can help to pay Medicare premiums and other costs, provided that they qualify. So physicians should check the eligibility to help process Medicare billing seamlessly People with Medicaid may be able to get coverage for service that Medicare doesn’t cover, such as nursing home care, personal care, and home- and community-based services. So physicians who think that patients with ailments that may require such services, should advise patients, so that physicians can thus , not be at a loss when recommending such services
Billing and Coding The physician who participates in the Medicare program often may co-ordinate with the state to have the Medicaid co-insurance or deductible Medicaid billing done automatically

Since the repeal of the Boren Amendment, the state can waive its responsibility to pay the deductible by determining that the 80% of the charge to Medicare billing is equivalent to 100% of the state’s value for that visit and thus the state owes the physician no additional funds.

Post submission Medicare process is cumbersome due to its rules and paperwork Complicated paperwork from state Medicaid programs and lengthy waiting time for reimbursements, is a further deterrent


Though the Obamacare law (ACA) did try a temporary fix by offering states money to increase the reimbursement rates for two years, hoping that this would help the physicians see more such Medicare patients. This however worked for the two years. Once that lapsed, the situation has reverted and physicians are seeing less Medicare patients.

However, if physicians, especially specialist in areas where their specialty is rare, can help negotiate for higher reimbursement rates or plans which offer just that from insurers.

Moreover the transition from ICD-9 to ICD-10 has also impacted Medicare in-patient hospital payments. The modifiers to be used or not employed need to be paid more attention to as this will affect reimbursements. The Obamacare Act has also introduced what is called a Value- Based payment Modifier (VM) which assess the quality of care furnished and the cost of that care under the Medicare Physician Fee Schedule and has certain criteria in terms of number of eligible Professionals ( which has a specific definition and includes only certain medical professionals) participating to be present while initiating it during the phases up till 2017

However, some good news, in April this year, 2015, the legislation headed off a 21 percent cut in doctors' Medicare fees that would have taken effect when the government planned to begin processing physicians' claims reflecting that reduction. The bill also provides billions of extra dollars for health care programs for children and low-income families, including additional money for community health centers.

An alternative for physicians who have enrolled under the Medicare scheme and to help concentrate on their value based performance to help out the numerous patients who could stream in given the spurt in insurance now available, and would likely cause a sizeable decrease in their income, if they do stop seeing such patients, would be to outsource this administrative work. By engaging with a credential specialist, Medicare enrollment procedures, getting into the insurance network so that streamlining your reimbursement process becomes easier to handle, will help physicians derive more from the Medicare & Medicaid billing and coding system increasing revenues in the long run.


Category : ACA / HIPAA / Reforms