Alabama Budget Crisis Leads to Medicaid Cuts

A recent budget crisis in Alabama resulted in decreased payments for physicians providing healthcare services to Medicaid patients.

Governor Robert Bentley asked for $785 million in order to continue the state’s Medicaid program without any modifications. However, they were only approved for $700 million, according to a press release from the Alabama Medicaid Agency.

Due to the $85 million deficit, many cuts to the program will be made. The first cut announced targets payment “bumps” to physicians who treat Medicaid patients, starting August 1, 2016.

Originally introduced in 2013 in accordance with Affordable Care Act laws, higher payments were given to physicians who provided certain primary care services and vaccinations. The federal government provided additional funding for these payments until 2014, and Alabama continued the incentives.

“I think it’s important for Medicaid providers and recipients to prepare for the impact of these cuts, because this is the budget for Medicaid at this point in time,” said Stephanie Azar, Alabama Medicaid commissioner.

This funding cut could potentially cause some physicians financial hardships and increase costs for patients.

“In just 5 months, one-quarter of our state’s population will be at risk of losing their access to health care because of the legislature’s inability to come to an agreement on funding options that would have helped close the $85 million gap in Medicaid’s budget,” said Alabama Medical Association Executive Director Mark Jackson in a statement. “More than half the births in Alabama and 47 percent of our children are covered by Medicaid, as well as 60 percent of Alabama’s nursing home residents. Without full funding, the Medicaid program will collapse, leaving these individuals without coverage.”

However, this cut is only estimated to save $14.7 million. It is likely that other elements of Medicaid will also face cuts to make up for the $70.3 million deficit.