Medicaid payments to hospitals are comparable to or even higher than Medicare payments.

Or at least they are once supplemental Medicaid payments are included.

So concludes a new study by the Medicaid and CHIP Payment and Access Commission, a non-partisan legislative branch agency that advises the states, Congress, and the administration on Medicaid and CHIP payment and access issues.

In what MACPAC bills as the “first-ever study to construct a state-level payment index to compare fee-for-service inpatient hospital payments across states and to benchmark Medicaid payments to other payers such as Medicare,” the study found that

  • Across states, base Medicaid payment for inpatient services varies considerably, ranging from 49 percent to 169 percent of the national average. This variation is similar to the variation across states previously reported for physician fees.
  • States are not consistently high or low payers across all inpatient services due to differences in their payment policies.
  • Payment amounts for the same service can also vary within a state.

The MACPAC analysis also concluded that

  • Overall, Medicaid payment is comparable or higher than Medicare.
  • Specifically, the average Medicaid payment for 18 selected conditions was 6 percent higher than Medicare, and the average Medicaid payment for all but two of the conditions was higher than Medicare.
  • The average Medicaid payment for these 18 services was higher than Medicare in 25 states and lower than Medicare in 22 states.

Learn more about what MACPAC found in its new report “Medicaid Hospital Payment: A Comparison across States and to Medicare,” which can be found here, on MACPAC’s web site.