The governor’s plan to revamp Medicaid was met with some skepticism by lawmakers Thursday as they got a detailed briefing on the proposal to put managed-care organizations in charge of patient care.
State Department of Health and Human Services leaders described for a legislative budget committee a new government health insurance landscape where doctors’ offices, hospitals, mental health organizations run by local governments and state psychiatric hospitals become part of the statewide managed-care networks.
It’s likely that private managed-care companies will fight for the chance at a piece of the state’s $13 billion Medicaid market. But some legislators said they’d prefer to restructure the state’s existing Medicaid health network called Community Care of North Carolina.
Rep. Donny Lambeth, a retired hospital administrator, said the state has a ready-made foundation upon which to make improvements to Medicaid.
“I think we have the framework already in North Carolina, and I think we in North Carolina have to be the ones to solve the problem, not bring in outside entities,” the Winston-Salem Republican said.
Lambeth was one of several legislators who spoke up for CCNC, a home-grown managed care network that helps patients control chronic illnesses and reduce their emergency room visits.
CCNC traces its origins back about 25 years, has won national awards, and has built a reservoir of goodwill among lawmakers.
Community Care differs from the type of managed care networks that Gov. Pat McCrory’s administration wants in place by 2015 because there is no predetermined limit on spending, and health care providers are paid for each service, such as X-rays, blood tests and office visits.
The new managed-care plans would cover 1.5 million people covered by Medicaid. These are mostly poor children, elderly and disabled adults, and about 150,000 children with government-subsidized health insurance called Health Choice.
Companies would bid to cover patients for a set payment per person, and two to four companies would win the chance to offer health insurance plans. The companies would have to cover cost overruns.
DHHS Secretary Aldona Wos said managed care would be better for patients because it would integrate physical and mental health. It would also slow the increase in Medicaid spending, she said. Before DHHS can move forward with its plan, it must win approval from the legislature and the federal government, which pays more than 60 percent of Medicaid costs.
If the state moves to managed care, CCNC would not continue as it is, but it could bid to offer one of the statewide plans.
The N.C. Medical Society, the state professional group for doctors, vigorously opposed the proposal after it was unveiled two weeks ago.
Hospital administrators don’t like it, either, said Sen. Floyd McKissick, a Durham Democrat.
Hospitals “are particularly skeptical and dubious about this managed care model,” he told Wos.