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McCrory Announces Changes to NC Medicaid: “The Good, The Bad, and the Ugly”

Governor McCrory held a press conference this morning on North Carolina Medicaid Reform. Good? Bad? Or ugly?

For a full rundown of his comments, please click here.

In essence, Gov. McCrory admitted that the current Managed Care Organization (MCO) situation is not working. Holy cow!! Finally!

Secretary Aldona Wos stated, “We have a system that doesn’t meet the needs of the patient, that doesn’t meet the needs of the taxpayer.” Oh, holy WOW-ness!! (I’m doing the Snoopy dance in my head).

Gov. McCrory stated that, by 2015, three or four MCOs will be the private entities in charge of Medicaid for NC.  Right now we have 11 MCOs.  Hmmmm…so here we have a huge change….Good? Or Bad? Well, one thing to say for it, it’s a change. Anything has to be better than our current situation, right?  Let’s analyze:


The map above depicts the current MCO jurisdictions. So, in the next year and a half, which MCOs will close?

My guess? The smallest MCOs.

Regardless, what did McCrory propose this morning? And is this a fix?

  • Today Gov. McCrory stated that by 2015 only 3-4 MCOs will be in existence.

Good? Bad? Or Ugly?  It depends. Will those 3-4 MCOs act like the current 11 MCOs? Will the Division of Medical Assistance (DMA) be able to supervise these private MCOs? Obviously the answers to those questions determine the answer.

  • Today Gov. McCrory stated that the MCOs would be state-wide.

Good? Bad? Or ugly? Good!!!!  YES! YES! YES! What does that mean? That means (from how I understand this proposal) is that if a Medicaid recipient does not want to deal with East Carolina Behavioral Health (ECBH) (I am only using ECBH as an example), then the recipient could choose to use another MCO.  Whereas, currently, the Medicaid recipient is forced to use the MCO that’s jurisdiction covers the county in which the recipient resides.

I must say, statewide MCOs could be a really good thing. If, and only if, (1) the MCOs are supervised (it does not behoove NC to contract with a few MCOs, which end up putting their own profits ahead of the NC Medicaid recipients); (2) (in my humble opinion) the MCOs are not compensated by the amount NOT spent on Medicaid services (there needs to be an incentive to COVER recipients’ services, not to DENY the services); and (3) if there is some sort of consistency among the 3-4 MCOs (we don’t want Medicaid recipients to have to “shop” MCOs to find services; there should be a statewide consistency).

So, was today a step forward in Medicaid reform? I think so. But there are potential dangers that could make today’s reformation (for lack of better words) NOT good.  If we move forward thoughtfully and understanding of possible downfalls, these new changes could result in positive outcomes in North Carolina Medicaid.

One (of many) of my concerns? What happens to the health care providers that go bankrupt because of the MCOs between now and 2015?