Raleigh News & Observer Logo

Legislative report conflicts with state audit on Medicaid costs | Raleigh News & Observer

×
  • E-edition
    • Customer Service
    • Support
    • Contact Us
    • About Us
    • FAQ
    • Sponsorships
    • Stay connected
    • Mobile & Apps
    • Facebook
    • Google+
    • Instagram
    • Twitter
    • Social Media Directory
    • N&O Store
    • Buy Photos
    • Databases
    • Archives
    • Newsletters

    • Blogs
    • Columnists
    • Crime
    • Education
    • Health
    • Local
    • North Carolina
    • Nation/World
    • Science
    • Thumbs Up
    • Traffic
    • Weather
    • Weird News
    • All News
    • Counties
    • Durham County
    • Johnston County
    • Orange County
    • Wake County
    • All Sports
    • Baseball
    • Canes
    • College
    • Columns & Blogs
    • High Schools
    • NASCAR & Auto Racing
    • NBA
    • NFL
    • NHL
    • Olympics
    • Outdoors
    • Panthers
    • Soccer
    • Schools
    • Duke
    • East Carolina
    • NC State
    • North Carolina
    • All Politics
    • The North Carolina Influencer Series
    • State Politics
    • Blogs
    • Columnists
    • PolitiFact
    • PolitiFact NC
    • Rob Christensen
    • Under the Dome
    • All Business
    • Blogs
    • Columnists
    • Health Care
    • Personal Finance
    • Real Estate
    • Shop Talk
    • Stocks Center
    • Technology
    • All Living
    • Video Now
    • Best-Kept Secrets
    • Blogs
    • Celebrations
    • Comics
    • Family
    • Fashion
    • Fitness
    • Food
    • Games and Puzzles
    • Home and Garden
    • Horoscopes
    • Mouthful
    • Past Times
    • Pets
    • Religion
    • Travel
    • Video Now
    • Arts News
    • ArtsNow
    • Books
    • Contests
    • Dining
    • Entertainment
    • Games
    • Movies
    • Music
    • Nightlife
    • Television
    • On the Beat
    • Happiness is a Warm TV
    • All Opinion
    • Columnists
    • Dwane Powell
    • Editorials
    • Influencers Opinion
    • Letters
    • Opinion Shop Blog
    • Other Views
    • Submit a Letter
  • Obituaries

    • Advertise with us
    • Place Ad
    • Apartments
    • Cars
    • Homes
    • Jobs
    • Legals
    • Obits/In Memoriams
    • Weddings
    • Today's Daily Deal
    • Special Sections
    • Today's Circulars
    • Rewards
    • Photo Store
  • Classifieds
  • Jobs
  • Moonlighting
  • Cars
  • Homes
  • Legals

Under the Dome

Under the Dome

Legislative report conflicts with state audit on Medicaid costs

By Lynn Bonner - lbonner@newsobserver.com

    ORDER REPRINT →

November 20, 2013 05:45 PM

Administrative costs in the state Medicaid program are relatively low compared to other states, according to a report by the state legislature’s Fiscal Research Division.

The report contradicts findings from a state audit released earlier this year that found North Carolina was spending a higher percentage of its money on administration that other states.

Gov. Pat McCrory has used the audit to push the narrative that Medicaid is “broken” and needs reform.

Auditor Beth Wood defended her audit at the legislative committee this week where the fiscal research report was discussed. Some of the information used to create the legislative study came from a report that is not audited and has unreliable information, she said.

Sign Up and Save

Get six months of free digital access to The News & Observer

SUBSCRIBE WITH GOOGLE

#ReadLocal

Administrative costs in Medicaid have been a hot topic since North Carolina Health News unearthed an explanation prepared by the former administration of Gov. Bev Perdue that was deleted by Department of Health and Human Services from the audit response after Gov. Pat McCrory took office.

Legislators asked their fiscal staff for an analysis.

Many states have managed care companies running parts of their Medicaid programs. When managed care companies’ administrative costs are included, states that the auditor reported spending a smaller proportion of their budgets on administration than North Carolina actually spent more, according to the fiscal research analysis.

The information that the state audit used comes from a federal report structured to ensure standardization, “not to provide a basis for an apples to apples comparison for each category,” said Steve Owen of the Fiscal Research Division.

The fiscal research report included information gleaned from interviews with officials from other states’ Medicaid programs and a Milliman consulting firm report, he said.

For example, the audit reported that Tennessee spends 5.19 percent on administration, while the fiscal research report puts it at 11.35 percent. For Arizona, the audit has administrative costs at 1.73 percent, while the fiscal research analysis puts them at 11.24 percent. North Carolina is at 6.3 percent in the audit and at 6.4 percent in the fiscal research report. But the audit has the state paying a higher percentage for administration than any of the eight others listed, while the fiscal research report puts the state near the bottom for administrative costs.

The fiscal research costs are estimates, because only the information the individual states know about the managed care companies is included, not what the companies actually spend.

“All else being equal, it is reasonable to expect Medicaid MCO (managed care organization) administrative costs to be higher than fee for service programs because of profit and the requirement for the MCO to actively manage utilization,” the fiscal research report says.

In defense of her audit, Wood said Milliman notes that managed care companies don’t all define administrative expenses the same way, and the report includes the qualification that the information is not audited.

Democratic legislators homed in on the differences between Wood’s audit and the fiscal research findings.

“It looks as if our costs are among the bottom three states,” said Sen. Floyd McKissick, a Durham Democrat. He asked Wood how much work she did to make “an independent evaluation or assessment” of the information she found.

Wood said managed care wasn’t the focus of the audit.

  Comments  

Videos

‘Tuesdays with Tillis’ sings about the shutdown

Anita Earls officially joins the NC Supreme Court

View More Video

Trending Stories

‘An angry customer shot me.’ 911 calls reveal panic at Walgreens in Garner.

February 14, 2019 10:38 AM

NC State basketball player Eric Lockett charged with assaulting a woman

February 14, 2019 06:34 AM

What’s with NC State’s basketball roster? Update on 3 players who missed Syracuse game.

February 14, 2019 10:45 AM

Wake County commissioner accuses board member of lying, taking credit for park plan

February 14, 2019 12:40 PM

UNC will have two players out against Wake Forest, possibly three, depending on Nassir Little

February 15, 2019 03:40 PM

Read Next

Has your legislator supported nonpartisan maps? Here are the NC Republicans who have.
Video media Created with Sketch.

Politics & Government

Has your legislator supported nonpartisan maps? Here are the NC Republicans who have.

By Paul A. Specht

    ORDER REPRINT →

February 15, 2019 05:50 PM

Given Republicans control the legislature, it may seem like they aren’t interested in redistricting reform to change how maps are drawn. NC Rep. Chuck McGrady says there’s been support for redistricting reform.

KEEP READING

Sign Up and Save

#ReadLocal

Get six months of free digital access to The News & Observer

SUBSCRIBE WITH GOOGLE

MORE UNDER THE DOME

Mel Watt misused federal post, tried to ‘coerce’ worker into relationship, report says

Politics & Government

Mel Watt misused federal post, tried to ‘coerce’ worker into relationship, report says

February 15, 2019 04:02 PM

Latest News

NC jail deaths hit record level in 2018

February 15, 2019 08:33 AM
A timeline of the 9th district election fraud investigation

Politics & Government

A timeline of the 9th district election fraud investigation

February 15, 2019 03:35 PM
All mail-in ballots in Bladen, Robeson were tainted, McCready says in asking for re-do

Politics & Government

All mail-in ballots in Bladen, Robeson were tainted, McCready says in asking for re-do

February 15, 2019 01:54 PM
Congressional Democrats bring fight to restore Voting Rights Act to North Carolina

Politics & Government

Congressional Democrats bring fight to restore Voting Rights Act to North Carolina

February 15, 2019 11:39 AM
In a legislature divided on guns, NC Democrats propose a sweeping package of changes

Politics & Government

In a legislature divided on guns, NC Democrats propose a sweeping package of changes

February 14, 2019 06:36 PM
Take Us With You

Real-time updates and all local stories you want right in the palm of your hand.

Icon for mobile apps

Raleigh News & Observer App

View Newsletters

Subscriptions
  • Start a Subscription
  • Customer Service
  • eEdition
  • Vacation Hold
  • Pay Your Bill
  • Rewards
Learn More
  • About Us
  • Contact Us
  • Newsletters
  • News in Education
  • Triangletoday.com
  • Legal Notices
Advertising
  • Advertise With Us
  • About Our Ads
  • Place a Classified
  • Local Deals
  • N&O Store
  • N&O Photos
Copyright
Commenting Policy
Report News
Privacy Policy
Terms of Use


Back to Story