Privatizing Medicaid In Florida: cutting services and subsidizing profiteers

by S. Nappalos

The Florida House and Senate both have been considering bills to privatize Medicaid through turning over management of the health insurance to HMOs (health maintenance organizations). The house bill would extend this throughout the state, while the senate bill seeks merely to expand an ongoing pilot project in a few counties to 19 other counties (1). Medicaid is a state-insurance program which receives funding from the state and federal levels on a basis of financial need. This differs from Medicare which is mostly a federal program distributed largely on the basis of age. Medicaid draws a significant amount of funds from Florida, and Florida (especially South Florida) has been plagued from Medicaid fraud. The proposal seeks to cut spending and fraud based on claims that HMOs in particular and market-competition generally will reduce costs. Business Week reports that sponsors of the bills will not be able to settle on a common bill during this legislative session (2). Instead, they look to 2011 for another attempt (ibid).

In effect this would be a state-sponsored creation of a for-profit middleman to manage tax dollars. HMOs would take over effectively the role of distributing funding for services, and are said to thereby reduce the amount of fraud and waste in the system. Health care workers and advocates have already expressed concern that this will lead to a reduction in necessary services, and rerouting money used for patient care to profit. Medicaid has long been underfunded, and many doctors refuse to accept it based on an uncertainty about whether it will pay or not. By inserting a mediating for-profit bureaucracy into that system, the proposal would take more care away from the ailing, and put it into the pockets of the companies that have become infamous for their one-sided pursuit of financial gain at the expense of patient care. Broward County, one of the counties under the present pilot project of HMO-run medicaid, tried to pull out of the project over concerns of restricted access to care, excess bureaucracy to provide services, and profiteering via administrative fees (3). The American Medical Association published doubts about the reduction of costs in Broward, and printing concerns by physicians who argue that they have to work harder to get patients the same level of care (4). Interestingly the article quotes Tad Fisher, executive vice president of the Florida Academy of Family Physicians, as saying “…he would like to see Florida adopt North Carolina’s community care model, where physicians have input in the management of Medicaid case-management networks with medical homes.” (5).

While it is obvious why doctors would seek control over how Medicaid is governed, a report by Mercer, an independent analyst, found that the Community Care program in North Carolina had saved the state hundreds of millions of dollars annually in every year investigated (6). A study by Steiner et. al, in the Annals of Family Medicine entitled Community Care of North Carolina : Improving Care Through Community Health Networks estimates annual savings at around 300$ million in 2006 (7). Simplifying somewhat, the approach applied has been to prioritize free access to ongoing primary care, maintain lasting relationships between communities of patients and dedicated health care workers through Medical Homes (8), and physician participation in the planning and administration of Medicaid through community care. The cost cutting measures are thought to come from a preventative health approach which reduces costly hospitalization, and reduces the impact of trying and costly chronic diseases such as diabetes and asthma.

Whatever the merits of this model, it points to fundamental things about our health that the Florida proposal attempts to erode. Firstly, increasing access to care is crucial for the health of the community. Without our long term health certain, the productivity and living standards of our communities are in peril. Road blocks to access created by for-profit systems and middlemen (corporate or otherwise) result in illness unnecessarily being deferred until it is a vital emergency. The nation’s ERs are filled with the hidden cost of subsidizing corporate profits, and collectively we pay for that mistake through paying for the ERs. Secondly, a long term relationship of education, research, and care between the community and health care workers is critical in preventing illness from growing acute. Preventative medicine has been driven out of the system in favor of medication and procedure heavy medicine which profits pharmaceutical companies, equipment manufacturers, and the upper echelons of physicians. We need to build lasting links between communities who write their own health destinies, and health care workers who serve them without parasitic intermediaries. A network of preventative primary care can move us towards an educated society about our own health, and become more autonomous in our sustaining and expanding our health. Lastly directly democratic control over the management, distribution, and organization of our health care is crucial to human-driven health system. As long as tiny elites control all the decisions about our health care, our system will reflect their interests rather than the community as a whole. Only through struggling collectively to re-assert our control over our health resources, will we be able to wrest away the suicidal drive to constantly cut the life lines to our communities by those driven to personal and ideological gain. As a community we should push for patient and workers’ organizations that can challenge the companies and governments attacking our health care. By putting forward community control we show the way to a new alternative beyond the mire of more or less taxation.

(5) Ibid.
(7) Steiner BD, Denham AC, Ashkin E, Newton WP, Wroth T, Dobson LA Jr. Community care of North Carolina: improving care through community health networks. Ann Fam Med 2008 Jul-Aug;6(4):361-7.
(8) Medical Homes are health care centers intended to be comprehensive clinics making primary care available throughout the life cycle for families and communities. Through maintaining ongoing relationships, Medical Homes are thought to provide deeper understanding of patients by health care workers, increase patient understanding and engagement with their treatment, and prevent illness from developing and worsening rather than merely trying to correct or minimize illness already in place.