Schuyver, Paul R. Van

Background: Medicaid reimbursement to physicians is often perceived to be lower than Medicare, but little is known about orthopaedic foot and ankle reimbursement. This study sought to compare Medicare and Medicaid reimbursement for the 20 most common foot and ankle procedures. Methods: Medicare reimbursement rates for common foot and ankle codes were obtained from the online Centers for Medicare & Medicaid fee schedule, while Medicaid rates were found from individual state fee schedule websites. Medicaid rates were compared by state and pooled to obtain national differences. The Medicare Wage Index was used to adjust Medicaid rates by state wages to ensure a more accurate comparison. Variability between states was measured using state percentages of Medicare and coefficient of variation values. Results: Medicaid reimbursed physicians higher than Medicare in 31 states overall, with average reimbursement ranging from 37% to 324% of Medicare. Nationally, Medicaid reimbursed 8.8% higher than Medicare, but Medicare reimbursed 3.7% higher when adjusted for the Medicare Wage Index. The Current Procedural Terminology ( CPT ) codes with the highest ratio of Medicaid to Medicare reimbursement were CPT 28002 for incision and drainage of the foot (176.6%) and CPT 28820 for toe amputation (167.6%). Five codes had lower relative Medicaid reimbursement on average: CPT 27687 for repair procedures on the leg and ankle joint, CPT 28810 for amputation procedures on the foot and toes, CPT 28010 for toe tenotomy, CPT 28005 for incision procedures on the foot and toes, and CPT 28470 for closed treatment of a metatarsal fracture. The coefficient of variation values ranged from 0.34 to 0.84 in the Medicaid group and 0.40 to 0.78 in the adjusted group, indicating high variability between states and between procedures. Conclusion: Medicaid reimbursement is highly inconsistent between states, ranging from 37% to 324% of Medicare. Medicaid reimbursed more than Medicare overall, which is in contrast with most published findings that tend to show higher reimbursement for Medicare when compared to Medicaid. When adjusting for wage differences between states, Medicare reimbursed slightly higher than Medicaid. Level of Evidence: Level IV, economic analysis.

OBJECTIVES: This study seeks to evaluate the variability of Medicaid reimbursement and compare it with Medicare reimbursement using the 20 most commonly billed orthopaedic trauma Current Procedural Terminology (CPT) codes nationwide. The authors anticipate significant variability between states and hypothesize that Medicaid payment will be significantly less than Medicare payment. METHODS: The top 20 most common orthopaedic trauma surgery procedural codes were identified from a previous analysis performed by Haglin et al. The Centers for Medicare and Medicaid Services Physician Fee Schedule was used to determine reimbursement rates from Medicare, and state Medicaid fee schedules were used to determine reimbursement rates for Medicaid. State Medicaid rates were compared with their corresponding Medicare rates to determine a dollar difference. In addition, the dollar difference for each CPT code was divided by its respective physician relative value unit. This was used to acknowledge the possible variability in the complexity of orthopaedic procedures and the related physician effort. The Medicare Wage Index was used to adjust Medicaid rates based on the cost of living for the state as well. Coefficients of variation were calculated to represent overall variability in Medicaid and Medicare reimbursement rates. RESULTS: The mean reimbursement rates for Medicaid were lower for all 20 procedures compared with Medicare. On average, Medicaid reimbursed 16.0% less than Medicare and 29.6% less when adjusting for cost of living. MCD reimbursed at a higher rate than MCR for all procedures in only 9 states (Alaska, Arizona, Arkansas, Montana, Nebraska, New Jersey, New Mexico, North Dakota, and South Dakota) while 38 states reimbursed at a lower rate than MCR, on average. The coefficient of variation ranged from 0.24 to 0.34 for the Medicaid unadjusted group and from 0.35 to 0.46 for the Medicare Wage Index–adjusted group. By contrast, the Medicare group was consistent at 0.06 for all 20 procedures. The average dollar difference across the 20 CPT codes for Medicaid reimbursement compared with Medicare reimbursement ranged from −$76.89 to −$225.17, and the dollar difference per relative value unit ranged from −$5.96 to −$15.16. CONCLUSIONS: This study found a high amount of variation between state Medicaid reimbursement rates and average rates that were significantly lower than Medicare reimbursement rates for the top 20 most used orthopaedic trauma CPT codes as identified by Haglin et al. The discrepancy in reimbursement was increased when Medicaid rates were adjusted for state cost of living. LEVEL OF EVIDENCE: Prognostic, Level III. See Instructions for Authors for a complete description of levels of evidence.