Objective. To compare the availability of timely orthopedic care to a child with a fractured arm insured by Medi-Cal (California state Medicaid) and by private insurance.
Study Design. Fifty randomly chosen offices of orthopedic surgeons were telephoned with the following scenario: “My 10-year-old son broke his arm last week during a vacation” followed by a request for an appointment that week. Each office was called twice with an identical script except for insurance status: once with Medi-Cal and once with private insurance.
Results. All 50 offices offered an appointment to see the child with private insurance within 7 days. Only 1 of the same 50 offices offered an appointment to see the child with Medi-Cal within 7 days. Of the offices that would not see a child with Medi-Cal, 87% were unable to recommend an orthopedic office that accepted Medi-Cal.
Conclusions. Timely access to orthopedic care was available in 100% of offices polled to a child with private insurance versus in 2% of offices to a child with Medi-Cal. This is a significant difference. Lack of timely orthopedic care may result in poor outcome, ie, if a fracture is not properly aligned in the first few weeks, a permanent deformity may result. Although causation cannot be established from this study, we suspect that Medi-Cal reimbursement rates below the cost of office overhead may be of significance. Although federal guidelines require that payments must be sufficient to enlist enough providers so that services to Medi-Cal recipients are available to the same extent as those available to the general population, this study finds that that children with Medi-Cal insurance have significantly less access to timely orthopedic care.
In 1965, the federal Social Security Act authorized states to create Medicaid programs to provide health coverage to low-income families and certain categories of the aged and disabled. The federal government has broad, general outlines that govern the program, and states are responsible for administering and implementing the details of the program. The program is funded jointly by the federal and state government. California's version of Medicaid is referred to as Medi-Cal.
Children with Medi-Cal often arrive at our institution after unsuccessfully attempting to receive care at several other facilities. The purpose of this study is to see whether insurance status (private vs Medi-Cal) affects access to timely orthopedic care for children. Our hypothesis was that children with Medi-Cal insurance and an orthopedic condition requiring timely treatment have less access to health care than do children with private insurance. We are aware of no previous studies on this subject.
Fifty orthopedic offices were telephoned on 2 separate occasions, separated by at least 2 weeks, in an effort to make an appointment for a fictitious 10-year-old boy. All phone calls were made by 1 of the investigators. The common script for all phone calls was: “My 10-year-old son sustained a broken arm while we were out of the country on vacation last week. The fracture does not involve the growth plate. He is in a cast and we were told he needed to see an orthopedic surgeon this week.” The independent variable is the patient's insurance status. During 1 of the 2 attempts to make an appointment, the patient was said to have regular Medi-Cal insurance, specifically not administered by a health maintenance organization. During the other attempt to make an appointment, the child was reported to be insured by an unspecified preferred provider organization. A flip of a coin was used to randomize which insurance status was used during the first telephone call. Offices of orthopedic surgeons were identified from the 227 cited in the Los Angeles Medical Society Directory (1999 edition). Tertiary pediatric referral centers were excluded from the study to simulate access at the community level for a relatively common and straightforward diagnosis well within the capabilities of board-certified orthopedic surgeons. This left 135 orthopedic surgeons. We randomly chose 50 of these 135 orthopedic surgeons (37%) and telephoned these offices with our scripted request for an appointment. If an office would not see someone with Medi-Cal, they were asked whether they could refer the patient to an orthopedic surgeon who would be willing to see someone with Medi-Cal.
The following data were recorded from each attempt at making an appointment: date of phone request for appointment, date of appointment if given, whether insurance status was requested before making an appointment, and whether appointment was still given after insurance status was known. In situations in which an appointment was not given to the child insured by Medi-Cal, the office was asked whether they could recommend an orthopedic office that accepted Medi-Cal.
Statistical analysis was performed using SPSS, Version 6.1(SPSS Inc, Chicago, IL). A χ2 test was used for the comparison of the percentage of patients in insurance groups offered an appointment in a timely manner. For the purposes of the analysis, we defined timely orthopedic care to be within 1 week for this clinical scenario. Additionally, the relative risk of not receiving an appointment at any time was calculated, with the corresponding confidence interval. For patients who were offered an appointment, statistical significance in the difference in the time to the appointment between groups was calculated with an analysis of variance (Table 1).
Of the 50 orthopedic surgeons' offices telephoned, all 50 gave an appointment in 7 days or less (range: 1–7; mean: 2.7) when the child was reported to be insured with a preferred provider organization. In contrast, when the child was reported to be insured with Medi-Cal, only 1 of 50 offices offered an appointment within 7 days (on day 1). χ2 analysis of these data show that this difference in the percentage of children receiving an appointment within 1 week is statistically significant at the P < .0001 level. An additional 2 offices gave an appointment at 9 and 27 days, when the child had Medi-Cal. Of the 3 offices offering an appointment to the Medi-Cal patient, the mean time of the appointment was 12.3 days, in comparison with a mean time to appointment of 2.7 days for the privately insured child (P < .001). The relative risk of not receiving an appointment in any time for a child with Medi-Cal was 16.67 times that of a child with private insurance. (confidence interval: 5.56–49.92)
Five of the 50 offices did not ask for insurance status before making an appointment but later withdrew the appointment when the insurance status was found to be Medi-Cal. Of the 47 offices that would not see a child with Medi-Cal, 41 (87%) were unable to recommend an orthopedic office that accepted Medi-Cal.
Our hypothesis that children with Medi-Cal insurance and an orthopedic condition requiring timely treatment have less access to health care than do children with private insurance is correct.
This study was motivated by our experience of seeing patients with Medi-Cal reporting great difficulties and delays in finding an orthopedic surgeon. This study was designed to evaluate access at the community level for a relatively common and straightforward diagnosis. Follow-up of a broken arm should be well within the capabilities of board-certified orthopedic surgeons and should not necessitate care at a tertiary referral center. In an otherwise healthy 10-year-old boy with an uncomplicated forearm fracture, fracture callus usually forms within 2 to 3 weeks of injury, making a change in position of the fracture unlikely. Thus, our hypothetical child should be evaluated within 2 weeks of injury in case the fracture is in an unacceptable position and requires manipulation.
There are other recent reports of inequality of health care between children with government or private insurance. An analysis ofNational Health Interview Survey data from 1993 through 1996 including 97 206 children found that publicly insured children were ∼50% more likely than were privately insured children to have an unmet health need (P < .01).1 Another study found that children with Medicaid insurance had a 1.3-fold increased risk of complicated acute appendicitis, compared with children with commercial insurance after adjusting for potential compounding variables.2 Cartland and Yudkowsky3 documented that >20% of some 1600 pediatricians surveyed by the American Academy of Pediatrics had children within managed care systems denied access to subspecialty care within the past year. Perhaps as a result, these pediatricians were less likely to refer children within managed care systems for subspecialist care, highlighting the impact that referral barriers imposed by managed care have on patient access. Finally, Braveman et al4 found that lack of access to prenatal care among the underinsured resulted in significantly poorer clinical outcomes in these newborns. Taken collectively, these studies reinforce our experience that children with Medi-Cal often receive less than optimum care.
In California, Medi-Cal reimburses a community-based physician $19.80 and a hospital-based physician $15.84 for a follow-up visit (Current Procedural Terminology [CPT] code 99213), which would typically be billed during a follow-up visit for a child with a fractured distal radius treated with closed reduction and casting. The initial consultation may be billed as CPT code 99243 with usual Medi-Cal reimbursement of $49 for a community-based physician and $39.20 for a hospital-based physician. Hospital-based physicians are paid less than community physicians, because a separate room fee of $23.77 is paid to the hospital for each visit.
The Academy of Orthopedic Surgeons conducted a nationwide survey of 10 orthopedic practices in 1997 to determine the cost incurred by a practice during patient appointments. The mean cost to the office practice for seeing a patient was $77.32, including supplies (casting material, bandages, etc), personnel (nurses, receptionists, cast technicians, etc), rent, billings and collections, and other aspects of overhead. A similar study by the California Orthopedic Association in 2000 found the average office visit with radiograph costs a practice $77.5 Thus, it seems that, on average, the overhead cost to an orthopedic surgeon to treat a patient with Medi-Cal is more than the reimbursement.
When adjusted for inflation, Medi-Cal rates have decreased by 54% since 1985. California now ranks 47th among all states in expenditures for Medi-Cal/Medicaid per patient. To provide a comparison, Medicare, which is federally funded, reimburses a follow-up office visit for a broken arm (CPT code 99213) $52.84, more than double the $19.80 that Medi-Cal reimburses a community-based physician. Similarly, if an orthopedic surgeon were to charge a global fee for treatment of a nondisplaced distal radius fracture (CPT code 25560), Medicare would reimburse a community physician $286.19, whereas Medi-Cal would reimburse $37.84.
Medi-Cal and Medicare are government insurance plans. To the best of our knowledge, there is no access problem to medical care for people insured by Medicare. Because a major difference in the 2 plans is physician reimbursement, we suspect that this factor plays a significant role in the disparity of medical access between the 2 types of insurance.
To provide a comparison to charges for other common services within society, we performed an informal survey of veterinarians. We called 3 veterinarians, chosen randomly in the local phonebook, where this study was performed, with the following script: “My dog was in an accident and looks as if he has a broken limb. How much will it be to take a look at him?' Estimates of the cost of initial evaluation of the animal including radiographs were $113, $132, and $127 (mean charge: $124). This fee does not include fracture management or follow-up.
We suspect that low Medi-Cal reimbursement rates play an important role in this lack of access to health care, because insurance status is the independent variable in this study. Another factor that may discourage physicians from seeing children with Medi-Cal is the perceived threat of aggressive prosecution for fraud and abuse, in addition to administrative hurdles to receive reimbursement.
Federal regulations outline the basic guidelines of the Medicaid program. However, the federal government is not directly involved in setting reimbursement levels. California's Department of Health Services is responsible for establishing Medi-Cal reimbursement according to federal guidelines. The state legislature and the governor must approve any program changes that are within the scope of federal guidelines. The federal rules governing the establishment of reimbursement rates are listed below:
Encouragement of Provider Participation
“The agency's payments must be sufficient to enlist enough providers so that services under the plan are available to recipients at least to the extent that those services are available to the general population.”6
In the past, payments by private insurance companies were able to cover the financial loss of caring for the underinsured. Unfortunately, with rising costs and declining reimbursement from private insurance companies, physicians' offices can no longer rely on this strategy of cost shifting. Common sense dictates that if an office loses money on each visit of a patient with Medi-Cal, an office must necessarily limit the number of Medi-Cal patients it sees or face bankruptcy. The remaining offices, which are willing to care for Medi-Cal patients at a financial loss, are becoming increasingly overwhelmed.
Fortunately, the shortcomings of the Medi-Cal system documented in this study have been recognized by the California Legislative Analyst's Office (“Appendix”). They report that the Medi-Cal Program has not met state and federal requirements for setting rates ensuring reasonable access to health care, and research indicates that physician rates can affect access to care and health care quality. The Legislative Analyst's Office report recommends that in the short-term, if the legislature wishes to continue to narrow the significant gap between Medi-Cal physician rates and the rates paid under other health programs, Medicare rates should be used as a benchmark.
This study suggests that the above federal guidelines for Medicaid are not being followed in California and documents that having Medi-Cal coverage does not ensure timely access to orthopedic care for children.
Information obtained from the Internet site:http://www.lao.ca.gov/2001/020101_medi-cal_rates.html, California Legislative Analyst's Office, February 1, 2001.
A More Rational Approach to Setting Medi-Cal Physician Rates
Current Physician Rate-Setting System Key Findings
Medi-Cal rates are low compared with Medicare and other health care purchasers.
The Medi-Cal Program has not met state and federal requirements for setting rates ensuring reasonable access to health care.
Research indicates physician rates can affect access to care and health care quality.
Medi-Cal physician rates are not based on an assessment of relative access of Medi-Cal beneficiaries to quality health care or any measure of the actual costs of providing medical services.
Medicare has a rational, comprehensive rate-setting system that adjusts physician rates annually.
Medi-Cal physician rates now average ∼60% of Medicare rates.
We recommend that the legislature establish a more rational process for periodically reviewing and adjusting Medi-Cal rates.
In the short-term, if the legislature wishes to continue to narrow the significant gap between Medi-Cal physician rates and the rates paid under other health programs, Medicare rates should be used as a benchmark.
In the long-term, the legislature should direct the Department of Health and Human Services to perform a comprehensive analysis of access to physician services and the quality of care provided to Medi-Cal beneficiaries and offer proposals commencing in 2002–2003 for periodic future adjustments to physician rates based on that analysis.
This approach would benefit the state by potentially improving the quality of health care and by ensuring that the Medi-Cal Program complies with state and federal requirements to provide reasonable access to health care for Medi-Cal beneficiaries. It could also lead to the efficient use of medical services, provide more fairness to medical providers by basing rates on objective measures, and simplify the calculation of rates
The Legislative Analyst's Office serves as eyes and ears for the legislature to ensure that the executive branch is implementing legislative policy in a cost-efficient and effective manner. The office carries out this legislative oversight function by reviewing and analyzing the operations and finances of state government.
The Legislative Analyst's Office is overseen by the Joint Legislative Budget Committe, a 16-member, bipartisan committee. The office is located at 925 L Street, Suite 1000, Sacramento, California.
We thank Nina Lebron and Robert Adler, MD, for their editorial assistance.
- Received November 21, 2000.
- Accepted February 20, 2001.
Reprint requests to (D.L.S.) Division of Orthopedic Surgery, Childrens Hospital Los Angeles, 4650 Sunset Blvd, 69, Los Angeles, California 90027. E-mail:
- CPT =
- Current Procedural Terminology
- Bratton SL,
- Haberkern CM,
- Waldhausen JH
- Cartland JD,
- Yudkowsky BK
- ↵California Orthopedic Association. A Publication of the California Orthopedic Association. Sacramento, CA: California Orthopedic Association; 2000:8
- ↵US Government Printing Office. Code of Federal Regulations. Washington, DC: US Government Printing Office; 1999:253–275
- Copyright © 2001 American Academy of Pediatrics