Skip to main content
Subscribe
  • Login
  • My Account
  • Logout
  • Register For Free
  • Subscribe
  • News
    • Current News
    • Providers
    • Insurance
    • Government
    • Finance
    • Technology
    • Safety & Quality
    • Digital Health
    • Transformation
    • ESG
    • People
    • Regional News
    • Digital Edition (Web Version)
    • Patients
    • Operations
    • Care Delivery
    • Payment
    • Midwest
    • Northeast
    • South
    • West
  • Blogs
    • AI
    • Deals
    • Layoff Tracker
    • HLTH 2024
    • Sponsored Content: Vital Signs Blog
  • Opinion
    • Letters
    • From the Editor
  • Events & Awards
    • Awards
    • Conferences
    • Galas
    • Virtual Briefings
    • Webinars
    • Nominate/Eligibility
    • 100 Most Influential People
    • 50 Most Influential Clinical Executives
    • 40 Under 40
    • Best Places to Work in Healthcare
    • Healthcare Marketing Impact Awards
    • Innovators Awards
    • Diversity Leaders
    • Leading Women
    • Best in Business Awards
    • The 2030 Playbook Conference
    • Innovations in Patient Experience
    • Leading Women Conference & Awards Luncheon
    • Leadership Summit
    • Workforce Summit
    • Best Places to Work Awards Gala
    • Diversity Leaders Gala
    • - Looking Ahead to 2025
    • - Financial Growth
    • - Hospital of the Future
    • - Value Based Care
    • - Looking Ahead to 2026
  • Multimedia
    • Podcast - Beyond the Byline
    • Sponsored Podcast - Healthcare Insider
    • Sponsored Video Series - One on One
    • Sponsored Video Series - Checking In with Dan Peres
  • Data & Insights
    • Data & Insights Home
    • Hospital Financials
    • Staffing & Compensation
    • Quality & Safety
    • Mergers & Acquisitions
    • Skilled Nursing Facilities
    • Data Archive
    • Resource Guide: By the Numbers
    • Surveys
    • Data Points
  • Newsletters
  • MORE+
    • Contact Us
    • Advertise
    • Media Kit
    • Jobs
    • People on the Move
    • Reprints & Licensing
    • Sponsored Content
MENU
Breadcrumb
  1. Home
  2. Government
October 06, 2015 12:00 AM

Providers fret, insurers hail N.C. move to Medicaid managed care

Virgil Dickson
  • Tweet
  • Share
  • Share
  • Email
  • More
    Reprints Print
    North Carolina Gov. Pat McCrory signs the state's Medicaid reform law, which he said focuses on "delivering care where it makes the most sense for patients."

    North Carolina hospitals and doctors say the state's push to institute Medicaid managed care will reduce services for the poor and shortchange providers despite the legislation giving them the opportunity to bid on the contracts.

    Late last month, Republican Gov. Pat McCrory signed legislation enabling changes that will move the state's $12.7 billion Medicaid program serving 1.9 million residents from fee-for-service payments made directly to providers to capped payments to managed care insurers. North Carolina must get approval from the CMS before making the change.

    The legislation allows the state to award three statewide managed-care contracts to insurance companies. But at the same time, it authorized the creation of as many as 12 regional “provider-led" entities—physicians and hospitals in a Medicaid ACO, for instance—that can sign agreements with the state to manage Medicaid populations within their territories.

    “Under the current system, we wait until people get sick to provide care and pay for tests—not outcomes," McCrory said in a statement. "This new system will focus on keeping people healthy and delivering care where it makes the most sense for patients. We're going to accomplish this reform by paying providers based on improving patient's health—not how many services patients receive.”

    The goal of having both plans and provider-led entities involved is to give Medicaid beneficiaries multiple coverage choices regardless of where they live as the state moves to hold down costs. North Carolina, which didn't expand Medicaid to cover the half million residents who would have been newly eligible under the Affordable Care Act, saw its overall Medicaid budget grow just 1.5% in 2014 over the previous year.

    The driving force behind the move to Medicaid managed care in North Carolina, like in the 38 states and the District of Columbia that have already gone that route, is to provide greater budget predictability for the state program, which is only half-funded by the federal government. North Carolina is largest state that has not yet adopted Medicaid managed care, according to the consulting firm Avalere Health.

    Providers in the state backed changing the program, but rejected turning to private insurers as the main vehicle for cost control. "We're concerned about the draconian ways (plans) try to control things,” said Robert Seligson, CEO of the North Carolina Medical Society. “Instead of a value-based medicine approach, they focus on financial returns. Wall Street is what drives them.”

    “It's not what we wanted,” said Julie Henry, a spokeswoman at the North Carolina Hospital Association. “We wanted an exclusively provider-led system because from our perspective hospitals are already bearing the financial risk for Medicaid patients.”

    Patient advocates have also expressed concerns that the bill doesn't have robust patient protection standards, according to Adam Linker, a health policy analyst with the North Carolina Justice Center in Raleigh. Patients may have little recourse if they are unfairly denied care by a plan or in cases where care may be delayed, he said.

    To characterize managed Medicaid plans as being bottom-line driven is inaccurate, according to Jeff Myers, president of Medicaid Health Plans of America.

    “The state will set appropriate rules, will require plans to report and adhere to quality measures, and will hold (managed-care organizations) accountable for the results that providers inside their networks deliver,” Myers said. “Unlike the antiquated fee-for-service system, where no one was responsible for cost or quality care, the approach taken by North Carolina mirrors what" other states are doing.

    Providers, on the other hand, wanted the state to build on the success of a medical home initiative already in place for some Medicaid beneficiaries. The Community Care of North Carolina initiative organized 14 provider-based community networks, which still use fee-for-service but are paid a monthly per-member fee to coordinate patient care.

    The model appears to have saved the state money, according to a report from North Carolina's Office of the State Auditor released in August. Community Care of North Carolina saved the state $312 a year for every non-elderly Medicaid patient from 2003 to 2012, which equates to more than $400 million a year.

    Despite these findings, lawmakers wanted a system in which both providers and patients would have more plan choices, according to Rep. Sen. Louis Pate, co-chairman of the Senate's Health Care Committee. They also wanted to test which approach to care—either insurer-led or provider-led—would generate better results.

    The state plans to submit its waiver application to CMS by June 2016.

    Letter
    to the
    Editor

    Send us a letter

    Have an opinion about this story? Click here to submit a Letter to the Editor, and we may publish it in print.

    Recommended for You
    Legal-government-0225
    HHS lawsuit by Democratic AGs aims to stop restructuring, layoffs
    GettyImages-654573744.jpg
    Federal watchdog to retract medical debt collection opinion
    Most Popular
    1
    'Legendary' Hemsley takes over at UnitedHealth amid rough seas
    2
    Big retail tried to disrupt healthcare—who is making a dent?
    3
    These are the regulations the AHA wants RFK Jr. to scrap
    4
    Downside risk, upside payment highlight new CMS innovation agenda
    5
    Medicaid cuts bill clears key House committee
    Sponsored Content
    Modern Healthcare Alert: Sign up for this breaking news email to be kept in the loop as urgent healthcare business news unfolds.
    Get Newsletters

    Sign up for enewsletters and alerts to receive breaking news and in-depth coverage of healthcare events and trends, as they happen, right to your inbox.

    Subscribe Today
    MH Magazine Cover

    MH magazine offers content that sheds light on healthcare leaders’ complex choices and touch points—from strategy, governance, leadership development and finance to operations, clinical care, and marketing.

    Subscribe
    Connect with Us
    • LinkedIn
    • Twitter
    • Facebook
    • RSS

    Our Mission

    Modern Healthcare empowers industry leaders to succeed by providing unbiased reporting of the news, insights, analysis and data.

    Contact Us

    (877) 812-1581

    Email us

     

    Resources
    • Contact Us
    • Help Center
    • Advertise with Us
    • Ad Choices
    • Sitemap
    Editorial Dept
    • Submission Guidelines
    • Code of Ethics
    • Awards
    • About Us
    Legal
    • Terms and Conditions
    • Privacy Policy
    • Privacy Request
    Modern Healthcare
    Copyright © 1996-2025. Crain Communications, Inc. All Rights Reserved.
    • News
      • Current News
      • Providers
      • Insurance
      • Government
      • Finance
      • Technology
      • Safety & Quality
      • Digital Health
      • Transformation
        • Patients
        • Operations
        • Care Delivery
        • Payment
      • ESG
      • People
      • Regional News
        • Midwest
        • Northeast
        • South
        • West
      • Digital Edition (Web Version)
    • Blogs
      • AI
      • Deals
      • Layoff Tracker
      • HLTH 2024
      • Sponsored Content: Vital Signs Blog
    • Opinion
      • Letters
      • From the Editor
    • Events & Awards
      • Awards
        • Nominate/Eligibility
        • 100 Most Influential People
        • 50 Most Influential Clinical Executives
        • 40 Under 40
        • Best Places to Work in Healthcare
        • Healthcare Marketing Impact Awards
        • Innovators Awards
        • Diversity Leaders
        • Leading Women
        • Best in Business Awards
      • Conferences
        • The 2030 Playbook Conference
        • Innovations in Patient Experience
        • Leading Women Conference & Awards Luncheon
        • Leadership Summit
        • Workforce Summit
      • Galas
        • Best Places to Work Awards Gala
        • Diversity Leaders Gala
      • Virtual Briefings
        • - Looking Ahead to 2025
        • - Financial Growth
        • - Hospital of the Future
        • - Value Based Care
        • - Looking Ahead to 2026
      • Webinars
    • Multimedia
      • Podcast - Beyond the Byline
      • Sponsored Podcast - Healthcare Insider
      • Sponsored Video Series - One on One
      • Sponsored Video Series - Checking In with Dan Peres
    • Data & Insights
      • Data & Insights Home
      • Hospital Financials
      • Staffing & Compensation
      • Quality & Safety
      • Mergers & Acquisitions
      • Skilled Nursing Facilities
      • Data Archive
      • Resource Guide: By the Numbers
      • Surveys
      • Data Points
    • Newsletters
    • MORE+
      • Contact Us
      • Advertise
      • Media Kit
      • Jobs
      • People on the Move
      • Reprints & Licensing
      • Sponsored Content