Veteran Republican legislator worries about Medicaid privatization plan (video)

Today’s must read story on the main NC Policy Watch website is Sarah Ovaska-Few’s piece on plans to privatize the state’s $14 billion Medicaid program.  As Ovaska-Few explains:

The major overhaul of the state Medicaid system and subsequent privatization, outlined in a 14-page House Bill 372 made public last week, came after several years of talks in the Republican-controlled legislature about how best to contain costs for what is one of the state’s biggest expenses.

But any changes are still a long way off. Years could pass until the reforms outlined in the bill to bid out Medicaid services to managed care companies become reality with a lengthy process ahead to gain federal approval.

Opponents to the plan warned Tuesday that the state’s continuing refusal to expand Medicaid and then privatize the existing system would leave North Carolinians paying more in the long run for an inferior level of care for its most vulnerable residents.

Among the leading opponents of the new overhaul plan is Rep. Nelson Dollar, a six-term  House member and senior chairman of the House Appropriations Committee. Here’s what the veteran Republican legislator told his colleagues Tuesday:

“First, insurance HMOs have failed repeatedly in North Carolina. They were tried in the hospitals down in Mecklenburg County a couple of decades ago; they failed.

They failed in the mental health system a very few years ago and they also failed in the State Health Plan back in the ’80s and the ’90s, every time, leaving problems for this state to fix. I’m worried that could be the situation here a few years down the road.

The challenges that we have faced with Medicaid have not been the fault of the doctors, and the dentists, the pharmacists, the hospitals, the nursing homes and all the other providers.

People will tell you we have spent $2 billion fixing Medicaid over the last six years. That’s true, but what they fail to tell you is that we took back a billion dollars out of that system. And when we put in  $2 billion into the system, that money went to fix administrative problems, money owed to the federal government, loss of state and federal funding for the program.

The truth is that Medicaid claims costs in North Carolina has actually gone down over the last five years, while the program grew by over 200,000 recipients. This is a fact.”

While Rep. Donny Lambeth and other supporters believe Medicaid overhaul will result in budget predictability, Dollar warned that Virginia, South Carolina, Tennessee, and Florida have all experienced problems in the move to managed care.

For more on how the Medicaid privatization plan will impact Community Care of North Carolina, read Ovaska-Few’s story. Rose Hoban of NC Health News also offers an excellent summary.

Click below to hear Rep. Dollar explain his reservations with the Medicaid overhaul initiative: