In 2005, Medicaid surpassed Medicare as the largest government healthcare expenditure, and it is the fastest growing population of covered lives, say industry experts.
"This is a hot topic that will get hotter during election time as every governor and senator wrestles with controlling costs while delivering needed services," says Chris Mirro, vice president, Portfolio Management Group, ACS Government Healthcare Solutions, a government healthcare program administrator based in Dallas.
Since state Medicaid programs are the fastest growing healthcare programs in the country, it behooves managed care executives to pay close attention to how these programs are being managed, according to Blake Whitney, cofounder, president and CEO of Atlanta-based MDdatacor Inc., a healthcare information technology company.
The chart shows the size of the largest Medicaid programs by state, and includes the number of people covered in these programs. "Managed care executives typically spend 5% to 8% of their total budgets on administrative services, compared with 2% for Medicaid," Mirro says. "With these costs in mind, we need to look at what states are doing to administer their programs more efficiently, or what can be done so that they can spend more administratively in order to save proportionally higher amounts in benefit dollars.
"There are disparities that exist among state Medicaid programs across the country," Mirro continues. "Program expenditures, covered populations, benefit packages, and other items vary from state to state, and comparing program size without including cost of care per person doesn't tell us enough. It is important to evaluate programs based on their ability to deliver quality care, improve health outcomes and support the beneficiaries cost-effectively."
If Medicaid administrators are to overcome the challenges present in their current systems, they need to adopt advanced cost and care management strategies, Whitney says. "But as the saying goes, 'You can't manage what you can't measure.' Medicaid administrators need to start this process by considering the adoption of technology-driven solutions that not only enable them to measure current systems accurately, but also effect much-needed changes."
For example, Whitney explains, portable EHRs that include medical record information accessible by all Medicaid providers would result in the ability to monitor patient care comprehensively, "which is a vast improvement over the limited analysis they currently perform on claims data," he says.
Additionally, real-time eligibility verification linked to formulary compliance via e-prescribing saves time, reduces errors and curtails prescription drug fraud. "Furthermore, today's advances in point-of-care decision-support tools-such as the aggregation of all pharmacy, inpatient and outpatient billing data with current medical record information for each recipient delivered via a desktop resource-are able to solve provider 'front-office' issues before the delivery of care," Whitney says.