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Indiana To Boost Medicaid Reimbursement Rate

hospital bed

Photo: Nathan and Jenny (Flickr)

Hospital officials are praising the increase, saying it gives them more solid footing during a time when Congress is considering cuts to Medicaid at the federal level.

Governor Mike Pence announced Tuesday the state is increasing Medicaid reimbursement rates to health care providers beginning in January 2014.

Indiana cut the Medicaid reimbursement rate 5 percent in 2010, meaning hospitals, doctors and clinics got less money when seeing and treating Medicaid patients.  The cuts were made as the state struggled with tighter budgets from the recession.

Indiana Hospital Association President Doug Leonard says the increase announced Wednesday restores part of the cut.

“So this is a reversal of 2 percent of that cut, or effectively saying the 5 percent is being reduced to 3 percent,” he says.

Leonard says the 2010 cuts forced some hospitals to stop providing some services, notably obstetrical units in some rural hospitals.  He says restoring some of the Medicaid reimbursement is important as health care providers continue to face cuts from other sources.

“[It's] $340 billion from Medicare for the ACA and now the sequester on top of that so any attempt to reverse some of those cuts in a positive sign,” he says.

The governor’s office says the reimbursement rate increase is made possible through a higher Medicaid appropriation in the recently passed state budget.

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