Kentucky Gov. Ernie Fletcher's administration expects to save $72 million in Medicaid funding through disease-management programs by providing sufferers of asthma and diabetes with information about how to better care for themselves.
But some experts and administrators who have tried the concept say Kentucky's projected savings sound high, the Lexington Herald-Leader reported Monday. Other states have found the programs tough to work and slow to pay off.
Kentucky is expected to become the 20th state to attempt to cut costs with "disease management" programs in which doctors, nurses and other trained staff coach Medicaid recipients on how to use medicines correctly and how to adopt more healthful lifestyles.
State Medicaid planners are counting on saving $72 million with disease-management programs. Mark Birdwhistell, Kentucky's undersecretary for health in the Cabinet for Health and Family Services, projects savings of $24 million in the first year, and $48 million in the second. Birdwhistell said the projections are "fairly conservative."
He noted that Kentucky spends more than $900 million a year caring for people with diabetes or asthma.
In Washington state, which has about 900,000 Medicaid recipients compared with Kentucky's 670,000, statewide disease-management programs saved at least the $2 million required of its contracted companies last year, said Alice Lind, who manages the programs.
The programs have included about 27,000 people with diabetes, asthma, congestive heart failure or kidney disease over a two-year period.
"Although I think this is the right thing to do, people are advised not to book large savings," said Doug Porter, assistant secretary for Washington's Medical Assistance Administration. "There are modest savings to be realized."
Florida budgeted $64 million in savings over two years, anticipating fewer hospitalizations and expensive treatments.
In 2001, the Florida Legislature had to restore about $60 million in Medicaid funding, said Melanie Brown-Woofter, Florida's program administrator. She still likes the concept, but concedes that so far "we have not seen that large a savings."
Birdwhistell said private companies such as Passport Health Plan have made the "disease management" system work.
Passport has saved $110 million over five years by using disease management, combined with techniques to control hospital admissions and to help those leaving the hospital, Passport President Joyce Hagen said. She couldn't estimate how much savings disease management alone had contributed.
Meanwhile, in North Carolina, Medicaid is projected to soak up $7.2 billion in federal, state and county money this fiscal year. Still, a recovering economy, a one-time federal cash injection of $191 million and cost savings through prescription drugs and managed care have state officials cautiously optimistic that the state won't have exceeded its health budget when the fiscal year ends June 30.
"We're doing a lot of things that are saving a lot of money," said state Rep. Edd Nye, D-Bladen, a budgetwriter for the Medicaid program. "We're making strides, (but) not major strides."
The Division of Medical Assistance, with support from legislators, is attributing a lot of the cost savings they've achieved on disease management. By keeping chronic diseases like diabetes and asthma in check, fewer patients are having to go to the hospital for costly treatments, thereby reducing costs for the government entities that have to pay those bills.
Cabarrus Community Care Plan, a Cabarrus County, N.C., network, has achieved estimated Medicaid savings of $11 million over the past two years and as a result has come in under its budget for Medicaid expenses.
A study by the University of North Carolina-Chapel Hill determined that the asthma and diabetes projects saved more than $5.4 million over the last three years and could have created $11.3 million in cost savings last year if implemented statewide among all Medicaid patients.
Community Care also scrutinized the medications of 9,200 nursing home patients who had taken 18 or more different drugs in a 90-day period. About two-thirds had their prescriptions modified at a savings of $15 million in a year.