Robert Seligson

Downtown Raleigh, the capital of North Carolina.

Providers worry and insurers are happy about North Carolina’s move to Medicaid managed care. Physicians and hospitals assert that the change, assuming that the Feds approve it, will reduce services for poor people and unfairly reduce money for providers.

Republican Gov. Pat McCrory  last month signed legislation to move the state’s $12.7 billion Medicaid program serving 1.9 million residents from fee-for-service payments made directly to providers to capped payments to managed-care insurers. But the Centers for Medicare & Medicaid Services must approve the change before it goes into effect.

The bill lets  the state award three statewide managed-care contracts to insurance companies and authorizes up to  12 regional “provider-led” entities  to  sign agreements with the state to manage Medicaid populations.

The governor said :“Under the current system, we wait until people get sick to provide care and pay for tests—not outcomes. This new system will focus on keeping people healthy and delivering care where it makes the most sense for patients. We’re going to accomplish this reform by paying providers based on improving patients’ health—not how many services patients receive.”

Providers  had  backed changing the program, but rejected turning to private insurers as the main vehicle for cost control, reported Modern Healthcare. “We’re concerned about the draconian ways (plans) try to control things,” said Robert Seligson,  chief executive of the North Carolina Medical Society, told the publication: “Instead of a value-based medicine approach, they focus on financial returns. Wall Street is what drives them.”