Dr. Mandy Cohen


State health officials may have delayed — from Nov. 1 to Feb. 1 — the rollout of major Medicaid managed-care changes in the Triad, Northwest North Carolina and statewide.

But the action taken by the N.C. Department of Health and Human Service has not made some local advocates less antsy about the potential impact on current and future recipients.

Medicaid currently serves 2.1 million North Carolinians. Of those, 1.6 million are scheduled to be enrolled in the new managed-care system under a federal waiver approved in October 2018.

However, the Triad’s three main health-care systems — Cone Health, Novant Health Inc. and Wake Forest Baptist Medical Center — said last week they have not signed a contract with any of the four statewide prepaid health plans (PHP) that are at the heart of the initiative.

Even with the four-month delay, DHHS has kept a mid-November deadline for hospitals and providers to sign contracts with one or all of the four PHPs: AmeriHealth Caritas N.C., Blue Cross and Blue Shield of N.C., UnitedHealthcare of N.C., and WellCare of N.C.

That deadline is linked to a mid-December deadline for being in the PHP’s provider directory to be eligible for selection by Medicaid enrollees.

Currently, if a Medicaid enrollee does not select a provider, it could be chosen for them by DHHS or a PHP after Dec. 15. That could mean enrollees may not continue seeing their current provider.

As a result, advocates say they are concerned that Medicaid managed care is at risk of disrupting care for a vulnerable population group.

“While some contracts are close to being finalized, the department is not currently aware of any that are signed,” said Kelly Haight Connor, DHHS communications assistant.

“The contract process is complex, with significant details that must be addressed by both the health plans and the hospitals.

“We have communicated to both health systems and health plans that mid-November should be their target deadline,” she said.

New plans

Managed care is a system under which people agree to see only certain doctors or go to certain hospitals, as in a health maintenance organization, or HMO, or a preferred provider organization, or PPO, health-insurance plan.

The new managed-care plans will pay providers a set amount per month for each patient’s costs. The DHHS will reimburse the plans.

The three-year PHP contracts are expected to be worth $6 billion a year. With two optional one-year extensions, a contract could be worth a total of $30 billion.

A potential monkey wrench into the rollout is an appeal to DHHS by MyHealth by Health Providers, a PHP in which Cone, Novant and Wake Forest Baptist are three of 12 hospital supporters.

The four planned PHP groups were chosen over Aetna Better Health of N.C., MyHealth and Optima Family Care of N.C. Inc.

The three non-selected groups filed their amended petition Sept. 19. Aetna said the petition “describes a range of concerns about the state’s procurement process.”

Each Triad health-care system provided a brief update last week on the status of their PHP contract negotiations.

“As a provider of health-care services to 120,000 Medicaid beneficiaries, we have engaged all pre-paid health plans in good faith negotiations regarding participation,” Novant said.

Wake Forest Baptist said it is “still in active discussions and contract negotiations with each of the PHPs and we are working toward the state’s deadline to have the contract completed.”

“This contracting process with PHPs is not connected to the legal status of MyHealth by Health Providers.”

Cone Health said it has not signed contracts with PHP providers “simply because we have not concluded negotiations.”


Sen. Joyce Krawiec, R-Forsyth, said she believed the health-care systems and other providers have delayed signing PHP contracts “in the belief that rollout would be delayed.”

That Sept. 3 delay decision by state Health Secretary Dr. Mandy Cohen came after Democratic Gov. Roy Cooper’s Aug. 30 veto of House Bill 555, a legislative funding bill that contained at least $218 million in start-up financing for the initiative.

HB555, known as a “mini-budget bill,” is tied to the on-going stalemate over the 2019-20 state budget that began with Cooper’s veto on June 28.

The new fiscal year started July 1 without an approved spending plan for the Medicaid managed-care rollout. The $218 million also is contained in HB966, the Republican state budget compromise.

During the controversial tactic used by House GOP leadership to override the state budget veto on Sept. 11 with 40 of 55 Democratic members not present, they also acted to override the HB555 veto.

The Senate has not scheduled a veto override on either HB555 or HB966.


Cohen said the next critical timeline will be mid-November “for needing certainty about the budget with statewide launch of coverage, as we will lose time because of the holidays.”

Cohen said DHHS tried to learn from similar Medicaid transformation initiatives in other states in opting for a two-phase rollout.

“The next set of activities that must be implemented depend upon budget action,” DHHS said.

That includes: making a final decision on the rates to pay health plans and providers; making sure health plans have enough providers in their networks to meet the needs of beneficiaries; deploying a complex algorithm to assign Medicaid beneficiaries who do not self-select plans and doctors to one of each; and obtaining federal approval to begin.

“On-going budget uncertainty has been an impediment to health plans finalizing contracts with doctors and health providers,” DHHS said. “An essential component of a well-run managed care system is the strength of the health care network available to beneficiaries.”

Krawiec said that “I think that providers will wait until absolutely necessary before committing to transformation (the PHP contracts).”

“Therefore, I expect they will not commit until the February rollout is imminent.

“Because the secretary chose to delay the rollout until Feb. 1, for this reason, I am not sure it’s necessary to override HB555.”

Rep. Donny Lambeth, R-Forsyth, and the House’s lead healthcare expert, said the House Health Committee plans to meet Oct. 16 “to air the issues” with the PHPs and providers.

“I believe the (PHPs) are going to be fine. I also think the issues around the bid process that have come to light and the MyHealth may have some impact.”

Mitch Kokai, senior policy analyst with Libertarian think tank the John Locke Foundation, said, “I don’t get the sense that Senate leaders feel a great deal of urgency on addressing HB555 outside the context of the budget.”

“Regardless of legislative action, the Cooper administration already has pushed back implementation of Medicaid changes until February. Overriding the governor’s veto is unlikely to change that timeline.

“Trying to round up Democratic votes for this veto override also could muddy the waters surrounding the budget veto,” Kokai said. “That item remains a much higher priority.”

The odds

Zagros Madjd-Sadjadi, an economics professor at Winston-Salem State University, said “I would place the chances of a Medicaid transformation rollout on Feb. 1 at this time at less than 50-50.”

“More likely, we will see another delay toward the end of the year.”

Madjd-Sadjadi said Cooper remains committed “to going all-in on demanding, if not a full at least a partial, Medicaid expansion in exchange for changes to Medicaid sought by Republicans.

“It also suggests the governor is more than willing to engage in a similar tit-for-tat strategy as the Republicans have had with respect to attempting to override his vetoes, and hope that time will be his ally rather than his enemy, especially as we approach the next general election next year.”

Lambeth said the PHPs are the groups most affected by the delay.

“They have been hiring staff and setting up call centers, etc., to meet the early phase-in dates, and now they are left having to cover their start-up cost and no way to recover it,” he said.

“The patients who will benefit from this innovative care model are also losers with any delay.”

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