Governor Signs Innovative Medicaid Reform Package
Governor Pat McCrory signed into law Wednesday a Medicaid reform bill that allows the state to contract with three statewide managed care companies and up to 10 regional “provider-led entities” (PLEs) comprised of health systems, hospitals and physicians. The new law provides a general framework for the future of the state’s Medicaid program, and physicians will work to help shape the specific details as the administrative rules and additional legislation evolve over the next few years.
This result follows several years of debate and effort by legislators and the health care community to address cost-unpredictability in Medicaid. The new plan is designed to give physicians who participate in the new PLEs greater flexibility to manage their patients’ health care delivery and costs. In place of the conventional fee-for-service model, Medicaid carriers will receive up-front, per-patient payments and will be responsible for cost overruns.
“This reform brings innovation to our healthcare system and builds upon what has already proven to work in North Carolina,” said Gov. McCrory at Wednesday’s bill signing ceremony.
A State Plan Amendment must be approved by the Centers for Medicare and Medicaid Services (CMS) prior to implementation, and this process may take 6-18 months. Federal funds account for two-thirds of NC Medicaid’s annual spend.
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