State Lawmakers Strip Recommendations Allowing Managed Care Into Medicaid

Dec 9, 2014

Credit Tulane Publications / Flickr, Creative Commons

An effort to open the state’s Medicaid program to managed care ran into trouble today. A report that passed a subcommittee easily last week was gutted in a health and human services oversight committee meeting this morning.

The move may indicate a victory for the administration and some Republicans who want to build on an existing program for Medicaid patients. 

This morning, Health and Human Services Secretary Aldona Wos left no doubt where she stands on the issue of Medicaid reform. She addressed a conference room filled with state lawmakers, reporters, and lobbyists.

"I firmly believe that the provider-led, patient-centric model, focused on whole person care, needs to be enacted and implemented in North Carolina," said Wos.

To people who’ve been following this issue over the last year, Wos’s stance comes as no surprise. She and Governor Pat McCrory advocate building on and improving the state’s current system of treating Medicaid patients. It’s called Community Care of North Carolina, and it’s seen by experts across the country as a national model.

This network of providers emphasizes coordination between health professionals, and disease and care management for patients.

But the report presented to the committee today by Republican Senator Ralph Hise suggested including managed care as an option for treating these patients. It also said health care providers should assume responsibility for the entire cost of treating patients within three years.

Bad for North Carolinians?

Wos said the best way to treat patients effectively on a budget is to find ways to help people be healthier over the long term, rather than arbitrarily limiting costs and starting an entirely new system from scratch.

Wos says that would be especially bad for North Carolina:

"It is overly aggressive. If we move too fast we will do more harm than good. That is not what everyone wants."

Wos said the best way to treat patients effectively on a budget is to find ways to help people be healthier over the long term, rather than arbitrarily limiting costs and starting an entirely new system from scratch.

That makes sense to health care providers and hospital organizations, which support Wos’ direction.

Yet some state lawmakers in the Senate, including Senator Hise, are more focused on containing costs on a year-to-year basis, with the help of managed care.

After Republican Representative Nelson Dollar passed an amendment that stripped out nearly all of the content in Hise’s report, Hise grew frustrated.

"I think there’s been a lot of attempts to sabotage this, from across the board, that have come both internally and externally, and I see this amendment as yet another one of those attempts," said Hise.

As he defended himself, Hise said his report represents a compromise between the House’s and the Senate’s stances on Medicaid reform. Part of that compromise, he said, includes mention in the report of patient care entities other than MCOs, or managed care organizations:

"I also would take a lot of challenge to the characterization of this as an MCO model. All that is said here is that we have not excluded MCOs from participation in North Carolina. As a matter of fact, if you’ll read the recommendation specifically, it gives priority to provider-led organizations."

History lesson

Yet despite those concessions, it may be that even the mention of the phrase "managed care" is enough to make lawmakers nervous these days. Representative Nelson Dollar said there’s a reason why.

"We have tried this three times in North Carolina," said Dollar. "We’ve tried commercial managed care. And it failed. It failed in a hospital experiment back in Mecklenburg in the nineties, we had HMOS with the state health plan- that failed, value options in behavioral health failed."

Dollar continued by saying even some private health insurance plans brought in to serve Medicare patients haven’t done so well.

Today marked a victory for lawmakers who don’t want managed care organizations to take part in treating Medicaid patients. But the issue could come up again when lawmakers reconvene in January.