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Middle ground on Medicaid?

Despite all the bumbling and fumbling in his state health agency, Gov. Pat McCrory and his embattled agency secretary, Aldona Wos, may finally be poised for a small policy and political victory.
Or, maybe not.
It may depend on whether they embrace the Otto von Bismark view of politics as “the art of the possible.”
What may not be possible — and McCrory and Wos may finally be recognizing it — is a full-scale reworking of the state’s Medicaid program to privatized, managed care in which insurers are paid monthly fees for each person enrolled. It’s a move that would hand over to insurers the financial risks, rewards and, ultimately, quality of care for the patients.
For months, McCrory has been talking about a potential move to managed care for Medicaid, the health care program for the poor. Legislative leaders have not embraced the idea, even as they have allowed the McCrory administration to explore it.
Health care providers, from doctors to hospitals and most everyone in between, oppose getting rid of their fee-for-service Medicaid system. The change would almost certainly mean less money in their pockets. But it could also mean a system where managed care companies cherry-pick the healthiest (and most profitable) populations of Medicaid patients, where doctors and insurers become embroiled in more disputes over care, and where patient care suffers as a result.
A political battle, involving a Department of Health and Human Services damaged by its delivery of marginally functional computerized claims processing systems, appeared to be brewing. Last week, though, health care providers and the McCrory administration began making reference to something that sounded a lot like a compromise.
At a hearing before an advisory committee examining Medicaid reform, hospital officials, doctors and pharmacists backed a proposal that involves something called accountable care organizations to try to control costs and manage care. A day earlier, a DHHS consultant had discussed with state lawmakers the differences between the accountable care organizations and managed care. A big difference is that the accountable care organizations are run by health care providers, not insurers, and a fee-for-service system would remain.
The ACOs are care networks of primary care physicians, specialists and doctors, designed to allow patients to receive seamless care. Doctors and others in the network would receive financial incentives or penalties based on their ability to keep patients healthy and out of high-cost treatments.
One advantage the ACOs would enjoy is that they are already being formed around changes to Medicare, the federally-paid health care system for the elderly. Still, they may never save the kind of money envisioned by managed care, even if some of those savings haven’t materialized in other states that have moved in that direction.
Of course, a discussion of a middle ground is just that, a discussion. It doesn’t mean that McCrory will accept it, or that, after a year of taking his lumps, he’s become a student of long-dead German politicians.
Scott Mooneyham is a columnist who covers state government issues for Capitol Press Association.

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