Rep. Becky Nordgren, R-Gadsden, has pre-filed a bill for the 2014 legislative session that would allow doctors and dentists who help impoverished patients to accept payment from the state in the form of a tax credit. Nordgren claims the change would convince more doctors to work with Medicaid patients.
"This is what doctors want," she said. "They want the bureaucracy out of their business."
More than 900,000 Alabama residents are on Medicaid, a state-and-federal health care program for some people living below the poverty line. Those patients are charged a co-pay of around $4 for a typical doctor's visit, and doctors bill the state Medicaid agency for their care. The state spent $615 million on the program last year, while the federal government kicks in billions.
Nordgren, who works for a medical supply company, said the payments are frustrating for doctors because their requests for reimbursement are often denied or returned.
"They do things like pay you and then take it back, because of a problem with the paperwork," she said.
A tax credit, she said, would be simpler. Still, it's not clear how much doctors would actually be paid under Nordgren's proposal, nor is it clear how much the bill would cost the state.
Nordgren's bill would set up a state tax credit that kicks in only if the federal government also establishes a tax credit for Medicaid providers — and it would set Alabama's tax credit at 35 percent of the amount provided under the federal tax credit. The bill doesn't include a "fiscal note," the cost estimate that is typically attached to a bill.
The Gadsden lawmaker has been trying for years to get both the state and federal governments to adopt the tax credit approach, with little success. She said she got the idea from Dr. Lucian Newman III, a Gadsden physician who's a frequent donor to Republican politicians.
Newman said he's worried that doctors will begin dropping out of Medicaid in coming years. Payments under the program have been stagnant for years, he said, and he expects them to decline under the Affordable Care Act.
"I started thinking about other ways to pay doctors," he said. Newman said the tax burden for a doctor in private practice is considerable. Use of tax credits, he said, could lighten that load while cutting down on paperwork.
"My thinking is that any time you move money from point A to point B to point C, you lose a little in the transaction," he said.
Nordgren tried to pass the same bill last year, but the proposal never made it out of committee. She acknowledges it will likely face a tough audience this year as well.
Alabama's state government runs two budgets — one for education agencies and another for all other state functions. At $615 million, Medicaid is the single largest item in the General Fund budget. But because income and sales taxes go mostly to the Education Trust Fund budget, Nordgren's tax credit would shift some of the burden of Medicaid to that budget.
The Ways and Means Education Committee, which controls the education budget, is likely the bill's first stop.
"I know it will be hard to pass," Nordgren said. "But when this idea does get legs, I want to be the one working on it."
One local medical administrator seemed ambivalent about the proposal.
Robin Adams, the office manager for RMC Urology, said her clinic is one of the few urology practices in Calhoun County that accepts Medicaid patients.
She said offering tax credits to doctors seems like a good idea.
“There’s a lot of Medicaid patients in this area, and they need to be taken care of like everybody else,” she said.
But more than the bureaucracy of the process, Adams said, the real deterrent for doctors accepting Medicaid is the reimbursement rate.
She said Medicaid has gone to an electronic credentialing process, and there’s not a lot of red tape now. She said she believes increasing the amount the agency pays doctors would be more effective that the tax credits.
Attempts to reach the Medical Association of the State of Alabama, which represents doctors across the state, were unsuccessful Tuesday. Staff members at Alabama Arise, an anti-poverty group that often speaks out on Medicaid issues, said the group never crafted a position on Nordgren's earlier tax credit bill because it was quickly rejected in committee.
Nordgren is a relatively new member of the Calhoun County delegation. Her district was redrawn after the 2010 Census to include a portion of northern Calhoun County. Etowah County coroner Michael Gladden, a Democrat, is running against her in the 2014 election. Attempts to reach Gladden Tuesday were unsuccessful.
The 2014 legislative session begins in January.
Capitol & statewide correspondent Tim Lockette: 256-294-4193. On Twitter @TLockette_Star. Assistant metro editor Daniel Gaddy contributed to this report.