Managed Medicaid: A Good Idea or a Recipe for Disaster?

Implications: Managed Medicaid is not a new concept. Over the last two decades, many states have implemented Managed Medicaid programs under the Centers for Medicare and Medicaid Services (CMS) 1115b Waiver program. The waiver program allowed states to implement Managed Medicaid programs as demonstration projects. Medicaid costs are becoming and increasingly larger portion of state budgets and many states are looking for ways to control or reduce these costs. These programs have implications for healthcare providers that service these patients, as well as device and drug manufacturers that provide products that treat health problems prevalent in this target population such as diabetes, chronic wounds, various pediatric illnesses and HIV treatments.

Analysis:  The results of Managed Medicaid have been very inconsistent. The TennCare program, Tennesee's early waiver program was eventually dismantled and revamped. It suffered from over-utilization of expensive and unnecessary hospital services, lack of true care coordination and significant budget overruns.

Many states have chosen to privatize their managed care program allowing for approved private managed care companies to market Medicaid plans to Medicaid recipients.

In order for South Carolina to be successful it will have to ensure that only high quality, fiscally sound companies are involved and that care is truly managed rather than just restricted access. Managed care works well when care is properly managed and tracked rather than just limiting the ability of these patients to access appropriate care.

The companies will have to ensure appropriate primary care services, educational programs, and chronic care programs are available.