Feb. DTR Analysis: Medicaid numbers on the rise

February 1, 2005

Medicaid enrollment is up in 18 of the top 20 states

Medicaid enrollment is up in 18 of the 20 states, but this is not surprising given some of the market issues that have occurred during the past few years, according to Frederic S. Goldstein, president, Specialty Disease Management Services. SDM has experience providing disease management services to Medicaid programs in seven states.

According to Goldstein, those market issues include:

  • Many states expanded eligibility criteria;
  • The number of uninsured has grown, and some of these individuals have become eligible for Medicaid;
  • The Medicaid market experiences natural growth, unless eligibility criteria are reduced.

"While the number of Medicaid beneficiaries is growing, costs are growing at a greater rate than the increase in covered beneficiaries," says Goldstein, who served as the vice president/general manager for a Medicaid HMO in Florida before starting SDM. "This is putting severe pressure on state budgets, and many states are looking for innovative ways to reduce this growth rate or reduce overall costs," he says. "Medicaid is one of the largest payers in the country. Many managed care companies, HMOs, disease management vendors and other organizations have decided to contract and provide services to state Medicaid programs."

Tennessee has made the decision to abandon the TennCare program and revert to a regular Medicaid program, removing 323,000 people from coverage. Mississippi attempted to remove a large group from their Medicaid program. Other states have or are planning to place more clients in Medicaid HMOs (Texas) or used other managed care tools in an effort to control costs (Texas, New Hampshire, and Pennsylvania all recently began implementing disease management), according to Goldstein.

In mid-January, Gov. Jeb Bush of Florida announced a major reform proposal that would provide Medicaid beneficiaries with a greater say in their healthcare management and implement a market-based approach. "This innovative proposal would take the state out of operating healthcare programs and have them serve as the financier of healthcare," Goldstein explains. "Beneficiaries would have the ability to use their 'premium' dollars to choose a plan that best meets their specific healthcare needs. The state would also implement quality measures to allow beneficiaries to get real information on what the plans delivered."

For more information on the Florida initiative, go to www.empoweredcare.com.