The following four charts demonstrate why NC Medicaid, far from being “broken” or worthy as a scapegoat for every unpopular budget decision made by the NC General Assembly, is containing costs better than any Medicaid program in the country while helping create better health for North Carolinians. The letter reproduced after the charts shows how disingenuous the “Medicaid is over budget” claim is by Governor McCrory and legislators.
1. NC Medicaid cost growth is very low. Just plotting some simple data from the Kaiser Family Foundation shows that the average annual growth in NC’s Medicaid program has declined for the last twenty years and the program is now growing more slowly than the national average. Current annual cost growth for Medicaid in NC is actually the lowest in the nation and much lower than the national average:
2. NC Medicaid has in fact been cutting what we pay providers. That’s right – over the last five years, NC Medicaid has been steadily reducing the fees we pay to physicians (with the exception of a very small bump in primary care reimbursement), while expecting more and more from our health system in improved quality and costs. This is the exact opposite from the overall trend in the US of increasing fees:
3. NC Medicaid reimburses providers far less than private insurance. For a normal delivery, NC Medicaid pays about 1/3rd of the average price ($9,775) charged by hospitals in the United States for having a baby. The price NC Medicaid pays for a normal delivery ($3,347) is more in line with countries like Switzerland, the Netherlands and the UK where health care costs are a fraction of what they are in the US:
4. NC has had one of the steepest declines in infant mortality rates in the nation. On a major indicator of health care quality – infant mortality – NC is one of five states in the nation with the biggest drop in infant mortality. We still have a long way to go, but we are doing well and a major reason is the care we provide through Medicaid:
5. Finally, former NC DHHS Secretary Lanier Cansler warned (in writing) the NC General Assembly back as it passed the last Medicaid budget that the cuts being demanded were unrealistic and unobtainable. It’s easy for the Governor and General Assembly to complain about going “over budget” if the Medicaid budget wasn’t realistic in the first place. This is just disingenuous. It’s like a manufactured crisis for someone has a $1,000 mortgage where they have budgeted $800 a month for paying the cost. Of course, every month they will face a crisis and overspend their budget – but this is because the budget wasn’t realistic at the start: