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Refusing to see Medicaid patients violates the law.

At least, that is what the Attorney General of Illinois, Lisa Madigan, is claiming in the recently filed anti-trust lawsuit against the Carle Clinic and the Christie Clinic. Madigan claims the two clinics, which employ 90 percent of Champaign County’s physicians, agreed to stop providing primary care to new Medicaid patients in an effort to increase Medicaid reimbursement rates and accelerate the time it takes for the state to make payments. The two clinics’ policies came after one of the clinic’s CEOs failed in lobbying the Illinois legislature to raise reimbursement rates. If Madigan’s suit is successful in Illinois, it could result in severe limits on the freedom of physician groups across the country to control the profitability of their practices. This comes at a time when many physicians are already frustrated by reimbursement rates that frequently do not even cover costs, let alone provide profits.

Although Mississippi’s Medicaid program ranked last overall in a recent survey by the Health Research Group, it reimburses almost at the national average rate and in many instances reimburses better than its sister federal program Medicare. However, this same survey found that average reimbursement rates for Medicaid are only approximately half of what the same services are reimbursed by the private sector. The dilemma is apparent–low Medicaid reimbursement rates (relative to the private sector) provide motivation for physicians not to see Medicaid patients. But in a state such as ours, consistently one of the highest Medicaid-dependent populations in the country, refusal by physicians to see Medicaid patients may be, in many respects, an unhealthy thing. And, although the Mississippi legislature has been fairly responsive to efforts to ensure appropriate Medicaid reimbursements rates, it is daunting to think that lobbying in Jackson may be the only avenue of economic survival for our healthcare providers for whom reimbursement rates are not keeping pace with the rising costs of providing quality healthcare.

The Illinois case has sparked some real debate regarding where the priority lies — with physicians who should be free to control their own economic situation, even if that means they refuse to see Medicaid-dependent patients; or with the patients themselves, who many claim have a fundamental right to affordable, quality healthcare. And if the priority is with the patients, does the burden then fall to our state and federal governments to take whatever actions may be needed to increase Medicaid reimbursement rates sufficiently that physicians are no longer effectively penalized by caring for Medicaid patients?

Ultimately, we may or may not see an answer to this issue out of Illinois. The issue for the defendant Carle and Christie Clinics may not be what they did–enacting policies that limited care to Medicaid-insured patients — but the way they did and why — agreeing with each other to enact similar policies in an effort to increase reimbursements rates.

The anti-trust laws prohibit competitors in any field of business from agreeing with each other to limit their services in an effort to raise their prices. Mississippi has a similar law to Illinois’. Physicians, like other professionals, have the right to refuse to provide services when they would not be profitable. However, what they cannot do is agree with other physicians to limit their services in order to drive up their profits.

If Madigan’s allegations are true, the clinics may have violated Illinois’ anti-trust statute, which allows for civil penalties and treble damages. However, health lawyers are arguing that the anti-trust statute is not appropriately applied to physicians and healthcare entities who limit their participation in programs that do not adequately compensate for services provided.

Medical service providers who are contemplating significant policy changes concerning provision of care to Medicaid or Medicare patients should carefully consider what impact the new policy may have on the community and how it may be perceived publicly. Although physicians, like other professionals have the freedom to refuse unprofitable contracts, as this nation grapples with the rising cost of healthcare and the significant number of citizens who have no insurance, the margins of physician autonomy may be narrowing.

In Mississippi, the number of uninsured people is significant. Any increase in patient participation may well necessitate more provider participation as well, not less.



September 2007

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