RALEIGH – Governor McCrory has outlined a framework for Medicaid reform to improve care, customer service and results for North Carolina’s young and elderly, disabled, mentally ill and low-income families.

The plan, entitled “A Partnership for a Healthy North Carolina,” calls for providers, recipients, taxpayers and the state to come together to implement a coordinated care model of delivery to bring long-term predictability, sustainability and efficiency to the program.

“Medicaid reform is long overdue and essential for the future health of North Carolina,” said McCrory. “We’re bringing all partners together to improve care, customer service and efficiency, but most importantly, to deliver right care at the right place at the right time to improve results for our state’s most vulnerable citizens.”

The reform announcement comes eight weeks after the Department of Health and Human Services issued a Request for Information (RFI), inviting all Medicaid stakeholders to the table to provide input in the reform process. More than 160 providers, recipients and advocacy groups responded to the RFI with feedback and ideas.

“This framework for reform was created from our recent RFI process,” said Department of Health and Human Services Secretary Aldona Wos, M.D. “We are building on to the innovative healthcare models North Carolina is known for around the country, and we are taking it to the next level with a system of comprehensive care.”

“A Partnership for a Healthy North Carolina” calls for the creation of several statewide Comprehensive Care Entities (CCE’s) that will provide the framework to deliver high quality, patient-centered care to Medicaid recipients. These CCE’s will each be empowered to:

Conduct Functional Needs Assessments to determine the most effective course of treatment for each recipient.

Create a Comprehensive Care Network of providers that will work collaboratively to improve health outcomes for recipients.

Compete with other Comprehensive Care Entities to provide the best-possible customer service and care.

The reform framework does not provide for any reduction in needed services or make any changes to Medicaid eligibility.

“These Comprehensive Care Entities will serve as the single place for recipients to get the care they need at the right place and at the right time,” said North Carolina Medicaid Director Carol Steckel. “This framework will empower the healthcare community to work together collaboratively to improve patient outcomes and make the system more efficient.”

While the Medicaid program was enacted in 1965 to provide basic health insurance at no cost for low-income families, the aged and individuals with disabilities, North Carolina’s system currently:

Does not focus on measuring and improving overall health outcomes for recipients;

Lacks a culture of customer service and operates in silos, making it difficult for recipients to know where to go to receive the right care;

Does not take a comprehensive approach to care, separating physical health from mental health and substance abuse;

Makes it difficult for doctors and other healthcare providers to participate because of a complex system with uncertainty, high costs and burdensome paperwork;

Experiences unpredictable cost overruns because of weak cost controls, high administrative costs and a lack of adequate oversight as evidenced by a recent audit of the program. Such volatility puts at risk funding for other priorities like education and road repair.

Over the next few weeks, officials from the Department of Health and Human Services will be meeting with lawmakers and various stakeholder groups to talk through the administration’s reform strategy and get additional feedback as the plan is finalized. The department will begin developing a Request for Proposals (RFP) to form several statewide Comprehensive Care Entities that will contract with the state to deliver services through provider networks. Concurrently, the Administration will work closely with the federal government and the Centers for Medicare & Medicaid Services (CMS) to finalize a formal application for a comprehensive Medicaid waiver.

Additionally, the governor sent a letter to Health and Human Services Secretary Kathleen Sebelius to accept her offer to assist North Carolina in reforming Medicaid.

“North Carolina cannot continue to overspend on Medicaid,” said  Sen. Ralph Hise (R-Mitchell), co-chairman of the Senate Health Care Committee and Appropriations Subcommittee on Health and Human Services. “We are pleased the governor has offered a proposal that brings efficiency and accountability to the system while serving patients’ needs. We look forward to reviewing the plan in greater detail and working together to finally fix our state’s Medicaid program.”

The McCrory administration’s Medicaid reform plan is the latest proposal to follow through on a commitment to deliver critical services to North Carolina’s most vulnerable citizens. Last month, Governor McCrory’s proposed a budget that fully funds the state’s Medicaid program with an additional $575 million over two years. His budget also establishes a Medicaid Risk Reserve in the amount of $180 million to address any potential mid-year shortfalls in funding and assist with overall Medicaid reform. Additionally, the McCrory administration has proposed additional resources to help those with mental illnesses and addiction, including a proposal to reinstate funding for North Carolina’s Drug Court program.

Individuals and healthcare providers with questions about this reform proposal can visit www.governor.nc.gov/medicaid, email MedicaidReform@dhhs.nc.gov or dial the DHHS Customer Service Hotline at 1-800-662-7030.