To Medicaid or Not to Medicaid…

on March 3rd, 2006 | Filed under Optoblog, Reviews

I have been exploring the option of accepting Medicaid in my practice. I have been told by some not to bother because the reimbursement is so low. Anyone can look up the reimbursement rates on the Utah state website. I’ve compiled the ones I expect to commonly use into a spreadsheet and compared them to Medicare’s reimbursement rates. Keep in mind that Medicare typically sets their rates at 60-80% of the average usual and customary.

The first thing you will notice is that UT Medicaid reimbursement is ridiculously low. Now, take the time to read the vision provider manual at the UT Medicaid site.

If you are like me, then you will have some questions. Here are the ones I had. Can any of you answer them?

1. Can I be a provider of Medicaid optometry services but not bother with providing Medicaid frames and lenses? I’m asking this because I may not be able to break even with thier reimbursement for materials.

2. Does Utah Medicaid have a lab I should use or would I be expected to find some ridiculously cheap frames and lenses to dispense? Oregon has a Medicaid optical lab where all Medicaid orders are processed. The doctors don’t lose money on materials, and they can charge Medicaid a dispensing fee.

3. The example of a frame upgrade in the manual was: normal price $35. Upgrade $50. Medicaid reimbursement $27.50. Is it okay for me to find some frames that I sell for $27.50 and dispense them to all Medicaid patients? I have heard stories of opticals using frames they can’t get rid of (i.e. discontinued models, ugly frames) as their Medicaid frames. Then they use an in-house lens grinder and put cheap plastic lenses with only a single side scratch coat into the frame. Is this okay? Pretend I only have ugly, BC frames for 27.50. The rest of my stylish frame selection runs around $100-$300. If the patient wants anything fashionable, then they’d be forced to upgrade and pay the difference themselves. So, why would I have any frames in the low price range other than 27.50?

4. Does the state of Utah honestly expect $27.50 frames to last two years? Seriously!

5. Can I opt to see only Medicaid children, not adults? I can see as many as 3-4 children in one hour, whereas adults take longer (they have more problems and love to orate about what a shock it is that ever since they turned 43 they can’t see up close anymore), so I can only see 2 per hour. If I’m getting so little reimbursement (39.29 on an S0620), then why not earn more money per unit time?

6. Can I opt to see only blue card recipients and not purple or yellow? From what I understand, blue card allows me to bill Medicaid $30 and any difference between 30 and my usual and customary can be charged to the patient. With Purple and Yellow, I have to accept Medicaid’s assignment as payment in full. Why would I want to see anything but blue card patients?

7. Why does UT Medicaid require refraction be included with 92004 and 92014 when that is not the definition of these services in the AMA’s cpt code manual? This question could be asked of most vision insurance companies. I believe the reason lies in getting something for nothing.

8. Why does Medicaid not pay for polycarbonate lenses for minors when that is the standard in the entire eyecare world? I believe the answer will be fiscal-no concern for trauma prevention.

9. Why is pachymetry (76514) not a covered procedure? Even Medicare pays 11.04. It’s only standard of care for not only Glaucoma, but many acute corneal conditions.

10. Why is the reimbursement for 92060 (VT Diagnostic exam) and 92065 (VT progress exam) set at the ridiculously low price of $5.32 and $4.13? Even Medicare, which typically reimburses 60-80%, pays $50.43 and $31.83. Do you think it’s ethical of me to know how to treat vision therapy conditions, do so regularly on patients with other insurance, but refer out a Medicaid patient because the reimbursement would cause me to lose money? The overly low reimbursement for VT services really chaps my donkey. They are forcing us to be unethical if we decide to be a provider because who in their right mind would accept 5-10% of their usual and customary as payment in full? The assignment is so low you would lose tons of money to try VT on a Medicaid patient.

Anyway, this is just the start of my concerns about becoming a Medicaid provider. I talked with an OBGYN physician once, and he says that for him, seeing Medicare and Medicaid is his charity work.

Another thing I don’t think is fair: How do you explain to your private pay patient that your exam really is worth the $85-100, but at the same time accept $35.50-39.19 as payment in full from a Medicaid patient?

1 Comment

One Response to “To Medicaid or Not to Medicaid…”

  1. Jim Schroder says:


    WOW, here in Iowa we get reimbursed at a much higher rate. I know for a new medicaid patient we get something like $94 and existing is $60-something.

    YES, we do only do exams for our Medicaid patients and tell them where they can find offices that have frames for them to choose from. It’s just simply not cost effective for us to have cheap frames in which we may break even.