The managed Medicaid that’s working just fine in NC

A lot of conversation has come from Raleigh over the past months about the need to reform North Carolina’s “broken” Medicaid system, and much of that talk is about a “homegrown,” outcomes-based solution made up of health care providers already working in cities and towns across our state.

Here’s one homegrown success story that already supports that direction: our state’s public-sector behavioral health managed-care organizations. There are nine local management entities/managed care organizations, or LME/MCOs, responsible for managing the mental health, substance abuse and intellectual/developmental disability care for residents of our 100 counties.

As a system, these organizations are successfully meeting the mandates our General Assembly has set for the Medicaid program, providing budget predictability and generating savings in excess of $171 million in Medicaid costs over the past two years. The entire public behavioral health system operates on a capitated basis, meaning that the LME/MCOs receive a pre-determined amount of money per month for each individual eligible for Medicaid care. In turn, they bear full financial responsibility for providing an established level of care to some of the most vulnerable of our state’s Medicaid recipients.

While more can be done to continue to create efficiencies and improve consumer outcomes, the LME/MCOs are succeeding while bringing much-needed stability to North Carolinians exhausted by years of constant change in how public behavioral health care services are provided.

Conventional wisdom says that managed-care companies achieve cost savings by limiting access to care to people who need it. However, as the leader of the 400 outstanding professional employees of Alliance Behavioral Healthcare, I know there is another route to cost savings and efficient use of taxpayer dollars.

While managing the behavioral health care of 200,000 Medicaid-eligible residents of Wake, Durham, Cumberland and Johnston counties, 8 percent more individuals received Medicaid services in 2014 than in 2013. At the same time, during 2013 and 2014 Alliance saved over $39 million Medicaid service dollars compared with an unmanaged system, savings that are not paid out to shareholders as dividends. Some of those savings are in the form of budget cuts and some are available to Alliance for reinvestment in providing additional innovative, effective services to more people.

And those savings didn’t come from denying more services. Strategies geared toward improving treatment outcomes have allowed Alliance to maintain a very low service-denial rate while expanding the number of individuals served and reducing the overall cost of care.

Alliance leverages long-standing collaborations with an array of partner agencies and organizations to create a “system of care” approach – a network of community services and resources that work together to provide the comprehensive “wraparound” support that is most effective in meeting the needs of children and adults with serious and complex behavioral health concerns.

Moreover, Alliance and the other LME/MCOs are working proactively to move toward a more comprehensive, integrated model of care designed to better serve consumers with high levels of physical as well as behavioral needs. They are engaging with local hospitals and physician-driven organizations like Community Care of NC to provide the coordination that improves quality of life, saves money and often increases life expectancy.

As the discussion about refining the Medicaid system in North Carolina continues, we urge decision-makers to build upon the part of the our system with a history of delivering proven results – our community-based public behavioral health managed-care organizations.

This story was originally published May 28, 2015 at 5:47 PM with the headline "The managed Medicaid that’s working just fine in NC."