State-to-State Variation in Medicaid Reimbursement for Neurosurgical Procedures: Implications for Healthcare Access in Vulnerable Populations

Abstract

BACKGROUND AND OBJECTIVES: Medicaid payment for healthcare services traditionally reimburses less than Medicare and commercial insurance. This disparity in reimbursement seems to be an important driver of limited access to care among Medicaid beneficiaries. This study seeks to examine the degree of variation in Medicaid and Medicare reimbursement for the most common neurosurgical current procedural terminology codes and determine its potential impact on provider accessibility. METHODS: In this cross-sectional study, maximum allowed physician reimbursement fees for 20 common neurosurgical codes reported in the literature were obtained from the 2022 Medicare Physician Fee Schedule and individual state Medicaid Fee-for-Service Schedules. The Medicaid-Medicare Index (MMI), which measures Medicaid reimbursement as a fraction of Medicare allowed amounts, was calculated for each procedure across 49 states and the District of Columbia. Lower MMI indicates a greater disparity, or “discount,” between Medicaid and Medicare reimbursement. The proportion of providers accepting new Medicaid patients and total Medicaid enrollment were compared across states as a function of MMI. RESULTS: The average national MMI was 0.79, with a range of 0.37 in NY/NJ to 1.43 in NE. Maximum allowed amounts for Medicare reimbursement (coefficient of variation = 0.09) were less variable than those for Medicaid (coefficient of variation = 0.26, P < .01). The largest absolute disparity was observed for intracranial aneurysm clipping in NY, where the maximum Medicaid reimbursement is $3496.52 less than that of Medicare. Higher MMI was associated with a significantly larger proportion of providers accepting new Medicaid patients (R2 = 0.43, P < .01). Moreover, MMI varied inversely with the number of Medicaid beneficiaries (R2 = 0.12, P = .01). CONCLUSION: Medicaid reimbursement varies between states reflecting the disparate methods of fee schedule calculation. Lower reimbursement is associated with more limited provider enrollment, especially in states with a greater number of beneficiaries.