South Carolina Gov. Nikki Haley has signed legislation that allows the state's bureaucracy to cut Medicaid payment rates to physicians, reports Healthcare Finance News. The bill allows for the repeal of a 2008 law that prevented the state's Department of Health and Human Services from lowering provider rates.
With the repeal of the law, a 3 percent across-the-board rate cut was imposed on providers April 8. It is expected to save as much as $7.5 million by the end of the fiscal year.
"What you are seeing when we sign this bill is that the patients come first, the providers are secondary, and through that we will prevent further service reductions," Haley said.
As an alternative to cuts to providers, South Carolina had been cutting supplementary coverage for vision and dental services. Physicians are against the cuts, warning it could lead to reduced services in rural areas of the state.
"We understand sacrifice and know that we must have some part in helping to balance the Medicaid budget," said Todd Atwater, a Republican member of the state House of Representatives who is also CEO of the South Carolina Medical Association. "But even this 3 percent cut may be too much for physicians to bear, particularly those in rural areas."