Variability in Medicaid Reimbursement in Hand Surgery May Lead to Inequality in Access to Patient Care

Background: Medicare (MCR) and Medicaid (MCD) remain the dominant providers of government-funded health insurance in the United States. The purpose of this study was to evaluate the variability between MCR and MCD reimbursements for common hand and wrist surgical procedures. We hypothesized that MCD reimbursement rates would have substantial variation between states, whereas MCR rates would remain relatively constant.

Methods: Using the Medicare Physician Fee Schedule Database, the 2019 reimbursements for 7 common hand and wrist procedures were recorded via the respective Current Procedural Terminology codes. The MCD reimbursement rates were then obtained from each state's physician fee schedule database. Comparisons of reimbursement for these procedures were then calculated between states and between MCD and MCR while adjusting for cost of living using the Medicare Wage Index. Finally, the coefficients of variation were computed to compare the extent of variability between the insurance types.

Results: Across all procedures, reimbursement rates for MCD ranged from 30.6% to 240% of the average MCR reimbursement, with the mean reimbursement for MCD valued at 78.3% of MCR. Endoscopic carpal tunnel release (CTR) is valued similarly by MCD compared with open CTR with an average of 77.7% and 78.2% reimbursement of MCR, respectively. The coefficients of variation for MCD reimbursements ranged from 0.25 to 0.45, whereas the value was 0.06 for all MCR procedures.

Conclusions: These findings demonstrate a wide variation in MCD payments between states. When compared with MCR, the lower average state MCD reimbursement questions the sustainability for hand surgeons to accept these patients in practice.