As of 2016, Medicaid accounted for nearly 20% of state general fund budgets. Optional Medicaid services like podiatry are often subject to cost-cutting measures in periods of economic downturn, as was the case in the wake of the 2007 financial crisis. Although the cuts were intended as a cost-saving measure, research indicates they had the opposite effect. The restriction and limitation of these services during the Great Recession resulted in both poorer health outcomes for beneficiaries, and poorer financial outcomes for state Medicaid programs. With states citing record levels of unemployment as of April 2020 and projecting significant declines in annual revenue in 2021, the economic conditions resulting from the COVID-19 pandemic are likely to rival those of the Great Recession. Given the historical precedent for restricting or eliminating optional Medicaid services as a cost-saving measure, it is likely that podiatric services will once again come under scrutiny. Previous efforts by state-level podiatric societies have proven successful in lobbying for the reinstatement of coverage under Medicaid by conveying evidence of the negative outcomes associated with elimination to stakeholders. The specialty must once again engage policymakers by drawing on evidence gleaned and lessons learned from past cuts of optional Medicaid services to avert counterproductive coverage restrictions intended to mitigate the financial impact of the COVID-19 pandemic.
The Board of Directors of the American Board of Podiatric Medicine approved the following position statement regarding hospital and surgical privileges for doctors of podiatric medicine on February 27, 2019. This statement is based on federal law, Centers for Medicare and Medicaid Services Conditions of Participation and Standards of the Joint Commission, and takes into account the current education, training, and experience of podiatrists to recommend best practices for hospital credentialing and privileging.
Background: Because value-based care is critical to the Affordable Care Act success, we forecasted inpatient costs and the potential impact of podiatric medical care on savings in the diabetic population through improved care quality and decreased resource use during implementation of the health reform initiatives in California.
Methods: We forecasted enrollment of diabetic adults into Medicaid and subsidized health benefit exchange programs using the California Simulation of Insurance Markets (CalSIM) base model. Amputations and admissions per 1,000 diabetic patients and inpatient costs were based on the California Office of Statewide Health Planning and Development 2009-2011 inpatient discharge files. We evaluated cost in three categories: uncomplicated admissions, amputations during admissions, and discharges to a skilled nursing facility. Total costs and projected savings were calculated by applying the metrics and cost to the projected enrollment.
Results: Diabetic patients accounted for 6.6% of those newly eligible for Medicaid or health benefit exchange subsidies, with a 60.8% take-up rate. We project costs to be $24.2 million in the diabetic take-up population from 2014 to 2019. Inpatient costs were 94.3% higher when amputations occurred during the admission and 46.7% higher when discharged to a skilled nursing facility. Meanwhile, 61.0% of costs were attributed to uncomplicated admissions. Podiatric medical services saved 4.1% with a 10% reduction in admissions and amputations and an additional 1% for every 10% improvement in access to podiatric medical care.
Conclusions: When implementing the Affordable Care Act, inclusion of podiatric medical services on multidisciplinary teams and in chronic-care models featuring prevention helps shift care to ambulatory settings to realize the greatest cost savings.