Wednesday, 28 December 2011
Connecticut Takes Medicaid Into Its Own Hands
Many American states have handed the government Medicaid program to private insurance companies over the past decade or so as a way to improve health care and reduce costs. It’s estimated that about 30 million Medicaid patients, which represents about half of the total, are looked after by private managed-care plans. However, according to an article by USA Today, Connecticut has decided to run the show itself.
Starting Jan. 1, 2012, Connecticut is going to take Medicaid plans back from private insurers and will take over financial responsibility. This is because state officials said the private companies weren’t providing better care and lower costs. In America, about 27 million Medicaid participants are looked after by managed-care plans and they represent $150 billion of the total Medicaid spending of $400 billion.
While Connecticut is taking Medicaid plans out of the hands of private insurers, many other states such as California, Texas, and Florida, are requesting that more residents join managed-care plans. Officials in numerous states are keeping their eyes on Connecticut to see how everything pans out. According to a Connecticut health care consultant, there are a lot of people against profit-making health care companies and this move is welcomed by them.
Ironically, Connecticut is known as the insurance capital of the world and about 2.1 per cent of the state’s population work in the insurance industry. Oklahoma was the first state to get rid of its private, for-profit Medicaid plans back in 2005 and it’s been reported that officials there are happy with the results. Oklahoma reported that Medicaid members there were happy with the cost and quality of their health care and the cost has risen just 1.2 per cent annually over the past five years.
In 2011, Connecticut’s Medicaid managed-care operations were worth over $800 million to several private companies. Critics of the managed-care Medicaid plans are hoping more states will follow Connecticut's lead and seek out alternatives. An advocacy group representing the poor, known as The New Haven Legal Assistance Association, said managed-care Medicaid sees too much money and too many resources going toward profits and administration.
The group said a report in 2009 showed that Connecticut overpaid insurers by close to $50 million per year, which represented six per cent of total expenses. Other states said the plans weren’t spending enough money on health services and some of the doctors that belonged to networks wouldn’t accept patients who were on Medicaid.
The article said many doctors in Connecticut are also happy with the state’s decision as they had to follow a different set of rules for the different plans. In addition, they also said there were delays in payments and they had difficulty referring some patients to specialists.
