Trends in Medi-Cal Reimbursement

Medicaid provides a safety net for the poorest Americans.  Although eligibility criteria vary from state to state, the health service Medicaid provides are often life saving.  One of the main problems Medicaid beneficiaries experience, however, is access to care.  Many physicians do not accept Medicaid because the reimbursement rates are much lower than those paid by either Medicare or private insurers.

California’s Medicaid program, named Medi-Cal, certainly has some of these access problems.  According to CHCF, California ranked 47th in the generosity of their Medicaid fees when these figures were adjusted for geographic differences in the cost of providing health care.

This same CHCF study revealed the following conclusions:

  • Overall, Medi-Cal fees were 83% of the Medicaid national average in 2008. Among the ten largest state Medicaid programs, California ranks 9th.
  • Considerable variation exists in Medi-Cal fees across procedures in relation to national averages, with relative fees ranging from less than 70% to more than 140% of the national average.
  • From 2003 to 2008, Medi-Cal physician fees grew, on average, by only 2%. This compares to 15% growth in average Medicaid fees nationwide and 21% general inflation during this period.
  • In particular, while evaluation and management (E&M) fees increased 20% nationwide between 2003 and 2008, Medi-Cal fees only rose by 4% over this time period.  National fees for vision services increased by 21%, but decreased by 15% in California.
  • Low average Medi-Cal reimbursement extends to dental care, with fees for most procedures falling short of those for Medicaid nationally.


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