May 13, 2015

Way, way back in the day, Redd Foxx played the irascible LA junk dealer, Fred Sanford. Periodically, son Lamant, sweating as he unloaded the truck, would exclaim “Pop, why aren’t you helping?” And Fred would say “Don’t bother me, I’m coordinating.”

In North Carolina, we have the NCDHHS bureaucrats running Medicaid and then we have Community Care of North Carolina “coordinating” Medicaid healthcare. CCNC is a nonprofit of medical providers who coordinate care for patients, matching patients with primary care doctors.

According to the Governor’s budget, CCNC has been paid roughly $200 million a year in recent years. The IRS filing by Community Care Networks of North Carolina, the parent of the various Community Care organizations, has recorded revenue gains from $7 million in 2009 to $29 million in 2012. Most all it seems to be from taxpayers. (OSBM)

CCNC employs the medical home model where primary care doctors are responsible for seeing patients and minimizing health problems before they go out of control. This system is supposed to save money by keeping patients out of the hospital. The medical providers are still paid primarily fee for serve medicine, the more you do, the more you get paid. But they also receive management payments to keep patients well.

CCNC claims it saved Medicaid hundreds of millions. The consultants they chose tell them it’s so and the rest of us are supposed to take their word for it. After all, they are the “coordinators.”

But here’s what an independent study found using information requested under the Freedom of Information Act. “The Disease Management Purchasing Consortium (DMPC)  announced today that North Carolina Medicaid’s “ACCESS” program may have cost the state more than $400 million in 2006 rather than saving the state roughly $300 million in 2006. ” In the likely event that this finding sustains further scrutiny, clearly it will continue to call into question whether the ACCESS model truly saves any money versus other models,” says DMPC President Al Lewis.

DMPC found that greater access to free primary care did indeed modestly reduce inpatient claims and even more modestly reduce emergency room visits, but at a high cost. The rate of visits to specialists, and the rate of claims for all other resources (testing and therapies) both climbed dramatically. “Our observation is very predictable, in retrospect,” says Lewis. “More access to primary care generates more primary care, which in turn generates more testing, therapies, and specialist referrals. The data in North Carolina shows that some of that preventive care does indeed replace inpatient care, but most of it doesn’t. In general, I think we are all collectively deluding ourselves that giving people more access to more free care without managing the care would decrease their use of care. Access without utilization controls is a recipe for overuse of care and higher costs.” (DMCPI)

It makes sense that paying for a lot of extra treatments (billing for a lot more service) might more than wipe out any savings.

Between 2009 and 2012, Democrat and Republican Legislatures asked CCNC to come up with a total of $210 million in management savings from Medicaid. But in fact, Medicaid ran over budget to the tune of billions of dollars according to the State Auditor. (WRAL)

Fred Sanford didn’t do much when he was busy “coordinating.” Are we getting our money’s worth from CCNC?

We could find out if managed care companies were allowed to bid against CCNC for Medicaid business. CCNC spends nearly a quarter million dollars a year on lobbying to keep out competition. But competition is what taxpayers deserve.