Commentary

The key to transformative Medicaid reform is Medicaid expansion

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Last week, providers, policymakers, NC DHHS administrators, and Governor McCrory enjoyed publicity as the governor signed off on the 1115 waiver application to reform North Carolina’s Medicaid system during a press event. In his letter to US DHHS Secretary Burwell, Gov. McCrory writes that the 1115 waiver “will allow North Carolina to implement innovative reforms to Medicaid and NC Health Choice (CHIP) programs.”  The content of the waiver explains that the goal of the waiver demonstration is to achieve the “Quadruple Aim”: 1) Per capita cost containment and funding stability, 2) Better health in our community, 3) Better experience of care, and 4) Improved provider engagement and support. The quadruple aim aligns with goals set by many states and the federal government as health providers, advocates, and lawmakers understand the importance of improving quality while decreasing or maintaining costs.

Unfortunately, NC policymakers continue to ignore one key element of the ACA that will strengthen the Tar Heel state’s ability to reach the quadruple aim – Medicaid Expansion. Just one week after the Medicaid reform press event, Georgetown‘s Center for Children and Families released a report on how closing the coverage gap not only increases individual access to health care, but has a huge impact on safety net hospitals and clinics. The report highlights themes from federally qualified health centers (FQHCs) in seven states, three of which did not close the coverage gap. Among expansion states, key themes in the findings align perfectly with North Carolina’s quadruple aim for Medicaid reform.

First is the economic benefit. By reducing the amount of uncompensated care, safety net providers are less likely like to experience fiscal distress. This is especially important considering that North Carolina has 16 vulnerable hospitals. Second, as a result of more savings, many health providers in expansion states were able to either open new facilities or expand services that ultimately improve community health. Third, the report states that while there is still difficulty addressing specialty care, they have greater capacity to improve access to specialty care, which could then improve patients’ health care experience. Fourth, providers in states that have extended coverage to those in the coverage gap are more likely to report improved provider engagement and communication which helps coordinate care and bolster efforts to integrate physical and mental health care. After reading the report and other evidence examining the benefits of Medicaid expansion, it seems that NC policymakers have ignored a key component in implementing a truly transformative and innovative reform.

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