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  • State Medicaid Reform That Works...If Washington Bureaucrats Will Allow It

    As the fight continues against the one-size-fits-all changes enacted under Obamacare, some states continue to work on health care reform specific to the needs of their residents.

    Florida is one such state. Its Medicaid Reform Pilot passed with bipartisan support in 2005 and has been implemented in five counties over the last five years. It has been a remarkable success, shifting a failing government health program away from the status quo of top-down micromanagement toward consumer-driven, patient-centered care.

    In a detailed analysis written for The Heritage Foundation, Tarren Bragdon, CEO of the Foundation for Government Accountability, a Florida based think-tank, outlines the successes and difficult road ahead for the Florida Medicaid Reform Pilot. As he explains, the Reform Pilot provides an important example for state reformers because it includes such a large population of Medicaid recipients:

    Today, 290,000 Medicaid recipients are part of the five-county Reform Pilot—more individuals than the state Medicaid programs in 17 states and more than the entire Medicaid managed care populations in 28 states, including 17 states with no comprehensive Medicaid managed care programs.

    After five years, the results of the pilot program are impressive from the standpoint of both patients and taxpayers.

    Bolsters Patient Choice

    Bragdon writes, “The patient, not politicians or bureaucrats, controls the money and chooses which plan, based on his or her needs and desires, receives the taxpayer dollars.” At least two options have been available to each individual participating in the Reform Pilot, and, depending on the year and county, the number of options has grown to as many as 16. The differences between plans are meaningful, so making the choice is a substantive one. Patients are able to reward the plans that best meet their needs and punish those that don’t.

    Improves Quality of Care

    The Reform Pilot offers Medicaid patients financial incentives for positive, healthy behavior. Combined, participants have been offered more than $31 million in incentives to remain diligent with immunizations, disease management, and annual physicals.

    Data on quality shows that patients enrolled in Florida’s Medicaid Reform Pilot have better outcomes compared to those in traditional Medicaid. Using the National Committee for Quality Assurance’s Healthcare Effectiveness Data and Information Set, Bragdon writes that “Reform Pilot counties outperformed non-Reform Pilot counties in 64 percent of the measures and exceeded the national average in 53 percent. For 68 percent of the measures, Reform Pilot counties showed greater improvement than non-Reform Pilot counties.”

    Reduces Taxpayer Costs

    In addition to improved health and satisfaction for patients, taxpayers have benefited as well. The Reform Pilot has saved the Florida Medicaid program $118 million each year, and if implemented statewide, would reduce Medicaid spending in Florida by $901 million annually. If replicated nationwide, savings could reach an annual $28.5 billion.

    Success on the Line

    The Florida legislature has passed legislation to implement these Medicaid reforms statewide, but its implementation is pending approval of six waivers by the Centers for Medicare and Medicaid Services (CMS) in Washington.

    CMS should grant Florida the waivers needed to make their successful Medicaid reform permanent. The agency has granted several waivers to Democratic states, including a particularly controversial waiver for California to make sweeping 10 percent reimbursement cuts to a wide range of providers including nursing homes, doctors, dentists and therapists.

    According to CMS, those cuts will not affect access to care, but experience proves otherwise. States would be better off to follow Florida’s lead and take a new direction in Medicaid reform rather than, like California, pursue more of the same, failed policies.

    But the question remains: Will CMS allow it? As Bragdon wrote in a letter to Richard Jensen, director of the Division of State Demonstrations and Waivers at CMS, “the health future of Florida’s Medicaid Patients and the fiscal future of Florida taxpayers rest with CMS.”

    Co-author Alyene Senger is a member of the Young Leaders Program at The Heritage Foundation. Click here for more information on interning at Heritage.

    Posted in Obamacare [slideshow_deploy]

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