North Carolina’s leading malpractice insurance provider cut premiums in response to tort reforms enacted last year. This is good news for patients and providers seeking lower health care costs.
By contrast, the Associated Press wired details of North Carolina’s exploding Medicaid deficit to Bloomberg Businessweek in early April. National coverage didn’t include a $320 million overdraw by our Medicaid Management Information System (MMIS) and a two year delay in its implementation.
Medicaid IT soars past budget and deadline
The joint government operations committee heard details in March of the failures in MMIS development. Ninety-percent of its costs are paid by the federal government.
The state auditor’s office reviewed MMIS in January and found the $320 million gap resulted from volatile regulation and compounding costs of the delay. Changes to state or federal eligibility are common and require expensive coding for implementation.
Federal support for the IT infrastructure doesn’t mitigate overspending because all 50 states must comply with the reform. Americans pay for and use the programs nationwide, while political reluctance to address overspending on benefits adds to the deficit and interest payments.
Expensive duplications arose from the delay and burdened the shortfall: both the existing Legacy system and the developing MMIS platform must comply with policy changes.
The state auditor is reviewing more IT projects in response to the abysmal results of the MMIS audit. The Department of Health and Human Services “did not fully document how it determined the amount of damages,” and did not timely identify $30 million in unauthorized changes according to the March 6 presentation. Contracts for MMIS “did not define how responsibility for delays would be determined” or “how damages would be calculated.”
North Carolina overspent more on one entitlement program this year than the $500 million IRS appropriation making headlines in the national debate.
The individual mandate adds millions of participants to Obamacare’s oversight in 2014. Tax credit and penalty provisions that structure the law are common targets for fraud. There’s little doubt the IRS will require billions more in diverted funds to enforce Obamacare.
Medicaid shortfall burdens other services
The fiscal year 2011-2012 Medicaid shortfall was $256 million – the $150 million figure reported in the AP story assumes unpaid receipts and tobacco settlement funds recoup $107 million for the program.
During the short session lawmakers must divert funds from other programs to fill this shortfall. Such actions allow entitlements to consume important services, as the $70 million interest payment on our unempoyment debt threatens state parks and cultural resources. In states like California and Illinois where Democrats hold majorities, the impending response is to increase taxes.
The Supreme Court can stop the bleeding in health care budgets if it overturns Obamcare. The shifting policies, community guarantees and IT development that drive overspending will be eliminated if the entire law is thrown out with the individual mandate. States will no longer develop costly exchanges and the IRS won’t need diverted funds to implement new tax credits and subsidies.
Lawmakers facing budget shortfalls could use that money to serve the struggling famlies who earned it. We lowered costs in North Carolina with malpractice reforms not contained in Obamacare or the federal agenda. Thanks for reading.
