December 18, 2014

The reform minded majority in the State Senate wants to bring Medicaid spending under control by allowing managed care companies and medical providers to compete against one another for Medicaid business.

Reform opponents say that’s too much change. They side with the medical industry, the folks making money off the $14 billion Medicaid cookie jar, who basically call the shots now.

But the truth is North Carolina used to have a managed care Medicaid system and it had some positive results. In 1996, North Carolina awarded contracts to 3 for profit HMO’s to care for Mecklenburg County Medicaid patients on a fixed cost deal. The Charlotte Observer reported “Mecklenburg is the first county in the state that will make HMO membership mandatory for most Medicaid patients. Later this year, the division plans to roll out the program in other metropolitan areas. On Monday, the division sent Medicaid contracts to Optimum Choice of the Carolinas Inc., Maxicare North Carolina Inc. and The Wellness Plan of North Carolina Inc .” (4/23/96)

In 1997,the Wilmington Star News wrote ”The health maintenance organizations that serve Medicaid patients in Mecklenburg County, the only county in North Carolina to have such a program, meet or exceeds expectation, according to a six-month state review. Last summer, Mecklenburg became the only county in the state to join the nationwide move to place Medicaid patients in managed health-care plans like HMOs. County officials estimate the total cost of care will fall from $54 million a year to $47 million once all 33,000 eligible recipients are in managed-care plans.” (2/17/97)

The plan kept working according to the Charlotte Observer. “The state’s decision to require some Mecklenburg Medicaid patients to join health maintenance organizations seems to be paying off. Medicaid spending on low-income people, primarily mothers and children, rose 1.6 percent last year, as most of those Medicaid recipients were required to join HMOs. Preliminary figures from the state’s Division of Medical Assistance show spending in that category rose to $68.9 million in the fiscal year that ended June 30, compared with $67.8 million a year earlier. First-year results are encouraging, said Bill Brandon, a UNC Charlotte professor of health policy who is analyzing the Medicaid managed-care program. “It looks like they’re saving money, and there really haven’t been any egregious examples of denial of care,” Brandon said. Total Medicaid spending – two-thirds of which goes to elderly, blind and disabled people, who are not in HMOs – rose 8.3 percent, to $239.4 million from $221 million.”(9/18/97)

So once upon a time, we had Medicaid managed care in one county and it seemed to work.

Maybe the conservative reformers in the State Senate can fix Medicaid by guiding us back to the future.