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Here's How NC Medicaid Transformation Could Affect Recipients

National Cancer Institute

If you get your health coverage through Medicaid, your care is about to change. On July 1, management of most of the program will be transferred to a handful of private companies. And starting Monday, 1.6 million North Carolinians can start to choose their plan.

The General Assembly mandated the transition to managed care five years ago, after large fluctuations in program costs frustrated their efforts to budget. Managed care companies will have to eat any overruns, but -- if they can save money -- they get to keep some of the funds they don’t spend

Dave Richard, who heads North Carolina's Medicaid program, said, “The financial side of it is that managed care gives you cost predictability. But we wanted to take the change to improve the health of North Carolina citizens.”

Care will now be managed by primary care providers. They’ll also coordinate the mental and behavioral therapy for their patients.

"What we want is the person closest to the patient to be managing the care of that individual," Richard said.

Patients will be asked about the social factors that affect their health, such as whether they have enough food or safe housing or transportation to medical appointments. And care managers will help connect the most vulnerable patients with social service organizations. Doctors will even be able to follow those referrals in a statewide computer system.

"When a physician says, 'You really need healthy food, I’m going to refer you to the food bank down the street' ... the food bank gets the referral," Richard said. "He knows they’ve gotten the referral, and then he knows what happens."

The state will also begin to tie compensation to improvements in patients’ health. Nurse practitioner and Democratic state representative Gale Adcock of Wake County says its the first time this has been tried in a Medicaid managed care program.

"When you do that, you incentivize people to give great care and as much care at one time that makes sense ... versus stringing it out because the only way you made money was to bring them back six times a year," Adcock said.

There are six plans and all are required to offer basic benefits -- things like doctor's visits and medical tests. But they’re also offering extra benefits, like memberships to Weight Watchers, smoking-cessation programs, and even the Boy Scouts for families with children. Some even offer free baby supplies.

Those things are an inducement to sign up, but they also help patients get healthier, says Troy Hildreth, the president of Wellcare of North Carolina, which offers one of the plans.

"Whether it’s additional transportation or home-delivered meals or gym memberships or GED support — those are things that we found can be beneficial for folks to help them improve their circumstances, their lives, certainly their health," Hildreth said.

Wellcare’s parent company, Centene, manages plans in 30 states. Hildreth says healthier patients use fewer costly services, and that’s what helps the company make a profit.

"There’s been no reduction in benefits," Hildreth said. "Folks are going to certainly have access to greater resources and benefits than they currently have today."

North Carolina requires the managed care companies to spend at least 88% of the money they receive from the state on patient care, not administration. And Medicaid program head Dave Richard says the state will impose penalties such as premium refunds if they don’t comply. He calls them “liquidated damages.”

Rep. Adcock, who sits on the Health Committee, says the (North Carolina Department of Health and Human Services) is responsible for making sure plans meet that requirement.

"What we’re not interested in doing is enriching a bunch of for-profit, out-of-state companies at the expense of Medicaid beneficiaries," she said.

But there have been problems with another managed care program that provides behavioral and developmental care to Medicaid patients. At least six counties, including Mecklenburg, want to sever their contracts with one of those companies, Cardinal Innovations.

William Munn of the left-leaning NC Justice Center worries the department’s oversight capabilities are stretched thin.

"We're concerned logistically about doing this when DHHS is 100% focused on getting the vaccine out to as many people as quickly as possible," he said.

Munn’s also worried about whether plans will offer enough providers in rural areas. And Adcock says doctors’ continued willingness to participate in Medicaid will have to be monitored. That's another metric to watch, she says.

"We’ll see what happens over the next four to five years," Adcock said."Does it start to precipitously drop and then you go what’s wrong with this program?"

There will be a lot of issues to monitor once the program rolls out. But after five years of waiting and planning, it looks like Medicaid transformation is finally preparing to finally go live this July.

There are close to 2.4 million Medicaid recipients, but only 1.6 million can start enrolling. How do people know if they’re supposed to sign up?

The basic rule of thumb, according to DHHS, is that if you get a packet in the mail describing your plan choices, you’re one of the people who’s supposed to enroll.

Some people won’t move to managed care.

Those in specialized Medicaid programs — like the Family Planning Program, the Health Insurance Premium Program or the Program of All-Inclusive Care for the Elderly — will stay in the current program which is administered by DHHS.

The medically needy and those in Refugee Medicaid will stay in the current program too.

Will people be able to keep their doctors when they move to managed care?

Not necessarily. People who want to keep their current physician should choose a plan which their doctor has joined. They can search that by going on the website,

My doctor is covered by more than one plan. How should I choose?

One of the ways to choose is by checking out the extra benefits offered by many of the plans. They’re all required to cover basic benefits — things like doctor's visits, lab tests and prescriptions.

Extra benefits are inducements to get people to sign up, but some people may find things they really need or want. They include things like memberships to Weight Watchers, carpet cleaning services for people with asthma and chiropractic care.

Are there any indications that some doctors who currently accept Medicaid patients are deciding not to join any of these plans?

Gregory Griggs, the executive vice president of the North Carolina Academy of Family Physicians, says its members are cautiously optimistic about the transition.

What happens if people don’t enroll?

Those who don’t choose a plan and a doctor by May 14 will be automatically enrolled. Dave Richard says the algorithm will match people to a plan with their current doctor where possible and try to keep family members in one plan. Once plans start on July 1, people have 90 days to change their assignments.

Copyright 2021 WFAE. To see more, visit WFAE.

CDC / Unsplash

Dana Miller Ervin
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