April 10, 2015

On January 15,2009, US Air Captain Sully Sullenberger, his plane’s engines shut down by bird strikes, glided his AirBus airliner to a perfect landing in to the Hudson River following takeoff from LaGuardia. His aviation feat became known as the “Miracle on the Hudson”.

Now the New York Daily News reports a new New York miracle. Democrat Governor Andrew Cuomo has tamed the Medicaid Monster.

For decades, New York Medicaid was a mess, a financial black hole sucking the state budget dry. However, Governor Cuomo finally called a halt to the spending party where special interest groups fed at the Medicaid trough.

Cuomo did two things. He told Medicaid providers to either cut costs themselves or he would give an administrator the power to cut the program for them. And Cuomo went all in on managed care.

Here is what the Daily News reports. “Faced with a $10 billion deficit, he started by calling for capping annual growth of the program based on the medical inflation rate. The brain-dead “inflation factors” written into law, which automatically increased fees whether the state could afford it or not, were wiped from the books.

But instead of dictating how the program would cut costs, Cuomo invited Raske and other industry representatives to do the job for him as members of a Medicaid Redesign Team.

The offer came with a warning: If the team failed to find enough savings, the health commissioner would be endowed with “superpowers” to cut as he saw fit.

The industry and the Legislature accepted the plan — and Cuomo’s gamble paid off. The panel came up with reforms that met or beat the savings target that first year, and every year since”.

Governor Cuomo used managed care to cut waste and bring fiscal discipline to the Medicaid system. The Daily News said “The chief strategy has been to move as much of Medicaid as possible into managed care — including formerly exempt groups, such as nursing home patients and the mentally ill, and benefits that were formerly carved out, such as prescription drugs and home health aides.

The managed care plans have not only squeezed millions in waste and fraud out of the system, but also a lot of the politics. Providers who think they’re being short-changed used to run to the Legislature with their complaints. Now, they haggle with HMO administrators.”

The things Cuomo is doing-giving an administrator the power to cut and going all in with managed care-are the same steps conservative reformers in the North Carolina Senate have passed.

The Senate wants an independent authority with power to cut spending to take charge from the asleep at the switch bureaucrats at NCDHHS. Senators want managed care companies with a proven record of success in other states to make sure patients are getting the right care at an honest price.

The Governor’s biennial budget contemplates another double digit spending increase in the Medicaid base budget. That shouldn’t be acceptable.

If we want to have the money to raise teacher pay, Medicaid must be tamed. A New York liberal like Andrew Cuomo is trying to do it.

Here in North Carolina, conservative reformers in the state Senate are trying to tame Medicaid with independent administration and managed care just like Cuomo.

Conservatives in the state Legislature should realize that when teachers don’t get a raise because Medicaid ate the money, Legislators will get the blame from the voters.