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North Carolina reform proposes fines for ducking ACO participation

North Carolina Governor Pat McCrory proposed state Medicaid reform that fines providers for not participating in an accountable care organization.

North Carolina's Pat McCrory set out to make changes to the current state of Medicaid during his first term as governor. His Republican administration submitted a Medicaid reform proposal to the legislature that has a health IT wrinkle: potential penalties for providers who don't participate in accountable care organizations.

Within the proposed reform are projections of significant savings for state and federal governments, accomplished through accountable care organization (ACO) participation covering of 80% of the Medicaid population in three years. The consequences of not hitting that goal, however, may see considerable resistance from physicians: "Providers participate in ACOs voluntarily; state may penalize non-participation if insufficient ACO capacity develops."

The proposed reform, McCrory's policymakers hope, will help deliver predictable and sustainable Medicaid program costs for the state; streamline its administrative work and efficiency; and provide better care for its Medicaid beneficiaries, including physician and behavioral health visits.

The reform also makes several savings projections that will benefit North Carolina Medicaid and the different services it currently supports for its beneficiaries. An estimate in physical health savings for the first five years amounts to $636,894,093 from July 2015 to June 2020, in the form of net Medicaid savings (federal and state shares). There are also other projected savings in long-term care services and mental health services. Those areas have been described as places where the reform is looking to become more comprehensive by expanding care coordination.

In the current market, many ACOs face the challenge of having to access varying HIE services in order to facilitate the flow of patient information to support their collaborative effort. North Carolina has been successful in creating a robust HIE and a sustainable model to ensure its longevity. With that in mind, the proposed reform might still be met with skepticism if penalties become a reality for any non-participants.

About the author:
Reda Chouffani is vice president of development with Biz Technology Solutions Inc., which provides software design, development and deployment services for the healthcare industry. Let us know what you think about the story; email or contact @SearchHealthIT on Twitter.

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