Republican former Gov. George Voinovich often called Medicaid "the Pac-Man of the state budget", as costs for the program rose and ate up more and more of the state budget.
A bipartisan group of state lawmakers want to tackle that problem by moving away from private corporations called managed care organizations, or MCOs. Those were implemented in Ohio in 2005 with the goal of administering Medicaid while reducing costs. But critics say the MCOs themselves are part of the problem. A group of bipartisan lawmakers has come up with a plan to do away with MCOs altogether.
Sen. Bill Blessing (R-Colerain Twp.) said Senate Bill 386 would do away with MCOs which act like middlemen in the Medicaid system. That legislation and its companion House Bill 780 would move Ohio to an Administrative Services Organization (ASO). Blessing said it's similar to the system in Connecticut.
“Over the course of 13 years, they saved $4 billion," Blessing said. "When you have the system of significant administrative overhead, you have a lot of profit in the MCO system that is now actually going toward health care outcomes."
Blessing said the legislation routes the cost savings back into the Medicaid program itself. He said it's modeled after what Ohio did a few years ago with pharmacy benefit managers.
The sponsor of HB 780, Rep. Karen Brownlee (D-Symmes Twp.), said Ohio could save more than Connecticut.
“This is a bill that could save Ohioans between $450 and $850 million a year. That’s a lot of money," Brownlee said. "And this is all done by how we streamline, how we deliver health care to the three million Ohioans who are on Medicaid."
SB 386 joint sponsor Sen. Beth Liston (D-Dublin), a doctor herself, said it will lead to better patient care. And she says the state has to focus on making the system leaner.
“Is this a magic bullet to fix all things in Medicaid? No. But I think we’re really looking at being down the barrel of a gun with cuts coming up," Liston said.
Supporters said it will simplify the system, increase participation from doctors who don't currently accept Medicaid and result in better outcomes for Ohioans who depend on Medicaid. But it's likely to face fierce opposition from MCOs and lawmakers who have other ideas for how to control the cost of Medicaid, including reducing services provided or making it harder for recipients to qualify for it in the first place.
