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Last week the Senate released its latest version of Medicaid reform calling it a compromise measure with the House. There are some changes to the Senate’s original proposal.

Under the amended plan a new Department of Medicaid is created but it remains within the Governor’s purview. It also allows for regional provider led entities to compete for Medicaid contracts with statewide managed care companies. For the most part, however, the bill is a radical revamping of Medicaid. It is difficult to see how adding all of this complexity will increase predictability. Instead, this restructuring creates a system with many moving parts that will require a new oversight regime. In the end patients are likely to get pinched between gaps in this structure and the state will spend time and money tracking problems and pursuing legal claims against private insurance companies.

Due to consolidations in the industry there are not many insurance companies that will bid to control Medicaid delivery in the state. Companies like Amerigroup and Centene and United HealthCare will likely get contracts under the Senate plan. North Carolina will get glittery promises and great deals in the first year. Then the problems will start.

Whether it’s discriminating against pregnant women, or improperly denying speech-therapy services for children, or denying patients timely access to critical medical services,  or delaying payments to doctors and hospitals, or pulling out of a state before completion of a contract, private managed care companies introduce a  great deal of uncertainty.

Although the Senate allows regional provider led entities to form, these organizations have major disadvantages when trying to compete with large corporations. The provider groups, for example, must meet the solvency requirements of a private insurance company. They must also move within a year to take on full risk. That means if they give too much care at too much cost the providers are stuck. They only get the amount of money they originally budgeted. This is not a huge problem for an insurance company with billions in revenue. It is more difficult for a small collection of rural clinics and hospitals. Also, if a big insurer is losing money it can pull out of the state never to return. Not so with a doctor’s office.

The Senate persists in wanting to end contracts with Community Care of North Carolina, our state’s Medicaid medical home model that has won national recognition.

It is difficult to see what problem the Senate hopes to solve by injecting so much complexity and uncertainty into the system. Trying to negotiate with large insurance companies and regional provider entities will introduce opportunities for fraud, waste, and abuse. It will also mean a major loss of state control over our Medicaid program.

The biggest beef legislators have had with Medicaid is the agency’s difficulty in projecting costs. Now that private insurance companies are having to deal with constant policy change, and now that they can’t cherry pick customers, we are seeing that they also have trouble predicting costs. Tearing down our entire Medicaid structure to get more reliable budget numbers seems like a bit much. We could, after all, move to a full-risk capitation model using provider agreements and CCNC.

Ultimately, the most short-sighted part of both the House and Senate proposals is that neither includes expanding Medicaid eligibility. Most states across the country are now expanding and reforming Medicaid at the same time. This allows governors to negotiate more conservative reform deals with the federal government. If we are going to ask patients and providers to undergo a painful reform process we could at least cover more people.

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Fifty years ago today President Lyndon B. Johnson created two of our most important safety net programs, Medicare and Medicaid. Medicare gave many seniors the health care access and financial security they lacked, and Medicaid gave many children a stable start in life. To help celebrate the occasion we decided to share several historical and policy-minded blog posts about these critical programs from some of our favorite national partners.

Community Catalyst says that we should celebrate the achievements of Medicare and Medicaid but notes that now is no time to rest:

At the time of enactment, roughly half of all older adults in the United States had no health insurance. Today, Medicare and Medicaid cover nearly 1 out of every 3 Americans – more than 100 million people. But there are still millions more without coverage of any kind, or with coverage, but inadequate access to care and services they vitally need.

While a pause for celebration is in order today, complacency is not.

The United States continues to spend almost twice as much per capita on health care as any other western democracy, with far less “bang for our buck,” in terms of health status and outcomes to show for it. Significant health disparities and unequal access to quality care continue to be hallmarks of our health system. These issues pose a threat to the sustainability of Medicare and Medicaid, as well as new programs established under the Affordable Care Act.

The Georgetown Center for Children and Families is celebrating because Medicaid has made a critical difference in the lives of so many kids (They even have a bonus video!):

With 50 years of experience serving growing numbers of America’s children, a new body of research is able to take a look at the long-term effects of childhood Medicaid coverage. Medicaid expansions in the 1980s and 1990s provided a natural experiment for researchers to evaluate how Medicaid eligibility affects children later in life. This longitudinal research tells us that children eligible for Medicaid grow up to be healthier, more academically successful, and financially secure adults than their non-Medicaid-eligible peers. We released a report that summarizes these findings earlier this week.

The Center on Budget and Policy Priorities has a post with 10 facts about Medicaid and Medicare. You should read them all but for our purposes number 9 is especially important:

9. Health reform’s Medicaid expansion is saving states money. The federal government will pay the entire cost of health care for newly eligible beneficiaries through 2016, and many states that have expanded Medicaid have found that it has produced net savings for their budgets. States will spend just 1.6 percent more on Medicaid and CHIP with the expansion than they would have without health reform, CBO estimates. Hospitals in expansion states are treating fewer uninsured patients, and the amount of uncompensated care they are providing is declining steeply. Meanwhile, hospitals in the states that have not expanded Medicaid continue to provide large amounts of uncompensated care, and the states are missing the opportunity to leverage billions of dollars in new federal funding through the expansion.

And, to commemorate the occasion, FamiliesUSA posted its many resources on Medicaid expansion with a reminder that Medicaid protects people from every walk of life.

Medicare and Medicaid were signature health care and anti-poverty achievements that we must work everyday to protect and strengthen. In our state that means pushing to expand the benefits of health care access to 500,000 more of our neighbors to give them a fair shot at living full, productive lives. Fifty years of experience tells us that’s the right thing to do.

Commentary

KeoughAt task force or committee meetings there is sometimes a strategy guiding where you sit. If an important legislator is in the room, for example, people will try to sidle up next to him or her to influence the policymaker’s thinking. As stakeholders gathered at the North Carolina Institute of Medicine for a seemingly endless series of meetings on implementing the Affordable Care Act in our state I often moved my name marker around to sit next to Michael Keough.

Folks outside of the worlds of state government or health insurance may not recognize Michael’s name, but he was an important leader and manager for many years in North Carolina. Most recently he ran the state and federal high-risk pools (called Inclusive Health in our state) that were created to help people with pre-existing conditions access health insurance until full implementation of the Affordable Care Act. Before that Michael ran Senior Care, which helped low-income seniors access prescription drugs before the implementation of Medicare Part D.

The high-risk pools shut down in 2014 because the Affordable Care Act banned the use of pre-existing condition exclusions, and Michael worked with partner organizations to start a health insurance CO-OP in North Carolina. CO-OPs are consumer centered health insurance plans that are up and running in several states. Congress killed CO-OP startup funding before our state’s plan could get approved.

You should start seeing a pattern here: Michael Keough cared about helping people access health care. That was the focus of his career. And he knew that prescription drug assistance and high-risk pools were only stopgap measures. He didn’t think of them as permanent solutions to our health care crisis.

I didn’t only sit near Michael at meetings because he was enormously knowledgeable about insurance and health policy, or because he fought for average North Carolinians. I sat near him mostly because he had a great sense of humor and he didn’t mind me passing him sarcastic notes.

I’m referring to Michael in the past tense because a few weeks ago we lost him much, much too young. In losing him the health advocacy community in our state lost a friend. I hate that he didn’t get to see the Supreme Court ruling in King v. Burwell because he would have been elated to see that the protections afforded to people with pre-existing conditions will continue.

You can watch some NC Policy Watch interviews with Michael and get a sense of the great work he did. We are a better state because of it.

Commentary

Now that the Supreme Court has ruled — again — that the structure of the Affordable Care Act is constitutional, it is time to move forward with making the law work better in our state.

The first, and most important, step is accepting federal funds to extend the benefits of affordable health insurance coverage to 500,000 more people in our state. Gov. McCrory said last year that his staff was assembling options to expand coverage and that he would make an announcement about his recommendation after the Supreme Court ruled in King v. Burwell. The ruling has arrived.

When asked about expansion today McCrory was sort of squishy and said he wants a North Carolina plan. We all do. But first we need the Governor to draft and release such a plan. Conservative Governors in Ohio, Indiana, Utah, Michigan, Tennessee and other states have either closed the coverage gap or assembled a strategy to accomplish a coverage expansion. There’s no reason our Governor can’t do the same.

Legislators are still critical of expansion. Sen. Ralph Hise says that he doesn’t think the federal government will be flexible enough to allow a state option. His wish list includes wanting to expand using private insurance and imposing co-pays on recipients above the federal poverty level.

Of course, the federal government has approved even more conservative measures than Hise mentions. Several states including Arkansas, Iowa, and Michigan do use private insurance to expand coverage. Some states are charging co-pays and premiums even on enrollees earning less than the federal poverty level. The federal government has shown a degree of flexibility that makes many advocates uncomfortable. The idea that our hands are tied is, to quote Justice Scalia, pure applesauce.

Recently released data from the National Health Interview Survey show the dramatic impact of expanding coverage. In Kentucky the adult uninsured rate dropped from 24.1 percent in 2013 to 15.6 percent in 2014. In Arkansas the rate went from 27.5 percent to 15.6 percent. And, most stunningly, in West Virginia the adult uninsured rate went from 28.8 percent in 2013 to 12.2 percent in 2014. These numbers reflect only the first year of expansion and states nearly cut their adult uninsured rates in half. In North Carolina the adult uninsured rate moved from 25.6 percent to 22.5 percent.

A majority of states are expanding coverage while reforming their Medicaid programs. More states will join their ranks now the Supreme Court has ruled that the Affordable Care Act is here to stay. The Governor must show leadership on this issue and ensure that all of our citizens have access to comprehensive, affordable health insurance.

Commentary

IMG_0831Last year Mayor Adam O’Neal from the tiny, scenic town of Belhaven, NC, made national headlines as he walked nearly 300 miles from Beaufort County to Washington, DC, to protest the closing of his rural hospital and to urge states to accept Medicaid expansion.

On Monday, June 1, O’Neal left Belhaven to replicate last year’s feat. And this year he is taking along advocates from around the country. As marchers filed out of town yesterday to start the arduous journey they wore shirts advertising their home states. A team of advocates travelled from Texas, some came from West Virginia and Alabama, a rural hospital CEO from Kentucky joined the walk, as did a woman from Seattle, Washington.

The message of the marchers is clear: we must save rural health care.

A key part of that agenda includes expanding Medicaid, as an Episcopal priest from Belhaven reminded the audience during a prayer before the send off. Rev. William Barber from the NC NAACP noted that Jesus made health care a central part of his ministry.

You can follow the march at this website. You can also tweet with the hashtag #savethe283. That refers to a national estimate that 283 rural hospitals are at risk of closing this year.

You can also join the final rally as marchers reach Washington, DC, and gather at the Capitol on June 15 at 10am.

And, finally, you can ask legislators and the Governor in North Carolina to accept new federal Medicaid funds to expand insurance coverage to 500,000 more people in our state.