Point of View

Managed-care Medicaid a proven failure when NC already succeeding

May 17, 2013 

MEDICAIDTALKS-NE-051513-TEL

N.C. Medicaid Director Carol Steckel, left, and N.C. Secretary of Health and Human Services Dr. Aldona Wos speak with health care professionals Wednesday in Durham about converting Medicaid to a managed care plan.

TRAVIS LONG — tlong@newsobserver.com Buy Photo

N.C. Health and Human Services Secretary Aldona Wos and State Medicaid Director Carol Steckel are to be commended for traveling the state to explain Gov. Pat McCrory’s plan for Medicaid reform – except there is little to explain.

Despite that, they are gamely marketing an unknown. Certainly it is not a listening tour as they routinely shut down experts who offer opinions contrary to what they want to hear.

A listening tour would have been wise. Now, however, it is time for some shuttle diplomacy. After all, Wos’ credentials are few but valuable: diplomat and retired physician. Diplomat Wos clearly knows the importance of listening and learning and seeking consensus.

A diplomat respects history: Isn’t it a truism that those who forget the past are doomed to repeat it?

Mental health providers and consumers have suffered through a wrenching decade of so-called reform that has poorly served everyone. Now, on the verge of a new at-risk, community-based, state-sponsored plan, Wos thinks we should scrap it and start over with managed care. Value Options – the private managed care company that ran mental health – failed.

When Community Care of N.C. was being birthed as Carolina Access, the state invited private managed care companies to pilot at-risk care in Mecklenburg County. Three companies responded and, one by one, they dropped out. The pilot failed.

Other states that have gone the managed care route have tales to tell. Companies eagerly come forward and offer incredible rates and reassurances that they can both manage care and costs. And they do, for the duration of the first contract. Then they return, not hat in hand but confident, and say they can’t do it for anything less than an 18 percent increase in fees. The state pays – and fails.

Managed-care companies know that actuarial risks are best spread over a wide population where healthier, covered lives cost less, freeing resources for the sickest. Medicaid expansion, being rethought in all states except, it seems, our own, is key to increasing the risk pool. We failed.

Budget insecurity? Ask our legislators about the Medicaid “cost overruns” of the last several years – years when state revenue was constrained. Our constitution demands a balanced budget, and our legislators provided one, knowingly underfunding Medicaid and expecting unrealistic cost controls. Later, when revenues exceeded expectations, Medicaid received the money everyone knew it needed months before. We failed.

Out-of-control Medicaid costs? North Carolina’s increase in Medicaid costs, at 3 percent, is the slowest growth in the country in a state that is both growing and experiencing prolonged unemployment from the great recession. There’s one where we succeeded – and we can thank North Carolina’s current managed care program: Community Care.

Wos should use her bully pulpit to speak these truths to power and use her diplomatic skills to shuttle among the Governor’s Mansion, the General Assembly, the experts, the constituents and the consumers who have so much at stake.

Three points seem clear to those who care to see:

• We have Medicaid managed care in NC. It’s called Community Care. It works.

• We need to keep our money in North Carolina, for North Carolinians. Our federal taxes will soon be buying Medicaid expansion for nearly everyone but us.

• We need to keep our money in North Carolina. We can’t afford to send profits to out-of-state managed care companies. That money buys jobs, care and measurable outcomes for North Carolinians.

Surely a diplomat can shuttle between the interested parties and draw success from our current path of sure failure.

Peter Morris of Fuquay-Varina is a past president of the N.C. Pediatric Society.

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