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North Carolina Medicaid’s Patient-Centered Medical Home: Lessons Learned

The ongoing saga of savings estimates for the Community Care of North Carolina (CCNC) patient-centered medical home (PCMH) is finally over.  The verdict: no savings. Because the scale and visibility of the CCNC experiment are unparalleled in the Medicaid sector today, it is important that the right policy and delivery system lessons be learned from this dispositive conclusion.

Lesson 1:  Enhancements in access do not necessarily create cost reductions, at least in Medicaid.

CCNC is by all accounts an excellent program from the patient’s perspective.  Indeed, if I were a Medicaid recipient, I would want to live in North Carolina.  The leadership of CCNC is passionate about the program and constantly strives to improve it.  However, as was amply observed by J.D. Kleinke on this very blog last week, Medicaid recipients have many lifestyle and economic issues that even the best-intentioned and best-incentivized doctors will never be able to systematically address.

Lesson 2:  Perhaps it is time to create an ER co-pay for Medicaid recipients that has more than one digit to the left of the decimal point.

Even as ER co-pays for commercial insurers have soared in the last decade, Medicaid ER co-pays remain virtually non-existent.  CCNC created excellent reasons to use primary care but was not permitted to re-price the ER to economically encourage use of primary care.  Many Medicaid recipients overuse the ER in part because it is basically free.  For the CCNC experiment to truly have a chance to reduce ER visits now that they have created a worthy substitute with their PCMH, it’s only fair to them (and to taxpayers) to reconfigure the financial incentives so that people use their worthy substitute … and then re-measure savings.

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