Do reimbursement delays discourage Medicaid participation by physicians?

Abstract

Policymakers have focused primarily on increasing Medicaid reimbursement rates to increase physicians' participation in Medicaid, although physicians often complain of payment delays and other administrative burdens associated with Medicaid. Linking state-level data on average reimbursement times to the 2004-05 Community Tracking Study Physician Survey, this study examines how Medicaid reimbursement time affects physicians' willingness to accept Medicaid patients. Delays in reimbursement can offset the effects of high Medicaid fees, thereby lowering participation to levels that are closer to those in states with relatively low rates. Increasing these rates may be insufficient to increase physicians' participation unless accompanied by reductions in administrative burden.