They amount to half or less than what physicians normally charge, he said. What's more, the increases in the 2001-2002 state budgets proposed by Gov. Gary Locke and the Senate will do nothing to close the gap between what physicians charge and Medicaid pays. The budget proposals are for a 2.1 percent increase for the next fiscal year, starting July 1, and 2.3 percent for the following year. These increases would augment fees paid to physicians who contract directly with the state. Other physicians serving Medicaid patients do so by contracting with health insurers that contract with the state's Medicaid managed-care program, Healthy Options.
Insurers negotiate fees with the physicians based on the rates they bid to the state.
The proposed budget increases for Healthy Options are only 6 percent for each of the next two fiscal years. Many insurers have dropped out of Healthy Options. This year, Regence BlueShield and Kaiser Foundation Health Plan joined the exodus. At one time 21 insurers contracted with Healthy Options, which started in 1992. Only seven remain, though some of the decline is attributable to mergers.