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The effect of a thirty per cent reduction in physician fees on Medicaid surgery rates in Massachusetts.

M Shwartz, S G Martin, D D Cooper, G M Ljung, B J Whalen and J Blackburn

In this paper, we use an interrupted time series analysis to assess the effect of a 30 per cent reduction in the Medicaid reimbursement fee for physician services on the rate at which eight elective surgical procedures were performed in the Massachusetts Medicaid population. Tonsillectomy/adenoidectomy is the only procedure in which there was a statistically significant decline in the rate of surgery in most areas of the state following the fee cut. There is some evidence of an increase in the rate of disc surgeries/spinal fusions. The rate of other procedures increased in some areas of the state and decreased in other areas in the period after the fee cut.

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