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What Would Our Iron Lady Have Said About the Governor's Medicaid Proposal

Posted: 04/17/2013

While reading about the Iron Lady, Margaret Thatcher, I reflected on Barbara Matula, who for many of us in the trenches of primary care, was the Iron Lady of North Carolina health care.  What would Barbara have said about the proposal to turn Medicaid over to for-profit insurance companies?  Barbara was the Director of Medicaid from 1979 to 1996, when a "hospital consortium" threatened to take over "her" Medicaid program.  Although Barbara's politics were far more liberal than those of Ms. Thatcher, she lived according to her inner convictions and because of her amazing instincts, intelligence, experience, and personal  drive was able to engineer the establishment of Community Care of North Carolina (CCNC).

Development of CCNC began in 1991, when government leaders, administrators, and health professionals came together to develop a Medicaid program that would better meet the needs of patients eligible for Medicaid, while restraining costs.  Today, physicians in 14 networks offer Medicaid patients a medical home (primary care "home base") that includes community-based care coordination. 

This approach has saved taxpayers hundreds of millions of dollars and is the envy of other states.  Last year, cost increases in NC Medicaid were one-half the national average for states. 

Because physicians are seriously involved with administration of the networks, the vast majority of physicians accept Medicaid patients and work with the state to reduce costs associated with unnecessary hospital admissions, emergency department visits, and expensive pharmaceuticals/ancillary services.

During the last 22 years, the state has considered, and has experienced short-term collaboration with for-profit insurance companies, but has concluded that the most efficient and cost-effective route does not require the services of private insurance plans.

In the early '90's, the state allowed three Health Maintenance Organizations (HMO's) to administer the program in Mecklenburg County, and required the HMO's to compete with the physician-directed networks.  The state soon discontinued the HMO contracts in favor of the CCNC network approach.

In 1996, a "hospital consortium" attempted to take over Medicaid.  Health professionals, especially those in rural counties, came together and lobbied the General Assembly, convincing lawmakers to turn down the proposal of the "hospital consortium."

In 1998, when the state established NC Health Choice, a program that gave children born into Medicaid access to health insurance until the age of majority, conservative legislators in the House forced the state to make Blue Cross the administrator for NC Health Choice.  Thirteen years later, conservative legislators realized that the state could save $16 million per year on administrative costs if the state took back NC Health Choice from Blue Cross -- so today, NC Health Choice is administered within Medicaid.

So, why would our Iron Lady say that NC Medicaid/CCNC has been so successful?  I believe it's because the prime focus is the well-being of the patients and an emphasis on working closely, day-to-day with providers and patients in their communities.  Community-based CCNC staff assure that patients have access to necessary services and help them navigate the local resources available to them in their home towns.  This is very different from patients calling 1-800 to talk with distant care-coordinators who know nothing about the patients' situations or community resources.

I think if our Iron Lady Barbara Matula were alive today, she would say, with unwavering conviction,  "Patients are really happy with CCNC.  Health professionals are pleased with the program.  Access to cost-effective primary care is very good.  Sure, there are administrative problems in any health care organization, and these must be addressed.  Consultants with private insurance experience can be brought in to assist with these administrative challenges.  But the infrastructure of CCNC must be preserved -- for the sake of the patients." 

David T. Tayloe, Jr., MD, FAAP

Senior Fellow, Action for Children NC

Past-President, American Academy of Pediatrics

April 12, 2013


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