The $830 million question

“It’s hardly transportable:” Dr. Craigan Gray, the state’s Medicaid director, demonstrates the size of his two notebooks that contain a copy of the Affordable Care Act. Caitlin Byrd

A central question for President Barack Obama’s health care reform law will be answered later this month. Namely, will the U.S. Supreme Court strike down the Affordable Care Act as unconstitutional?

If “Obamacare” stands, North Carolina will have other unknowns to contend with. Specifically, where will the state come up with the hundreds of millions of dollars necessary to expand Medicaid to cover those required under the new law?

These issues were among those discussed at a June 3 public forum at New Hope Presbyterian Church in Asheville that was sponsored by Elders United for a Just Society, a Buncombe County group focused on education and open-minded dialogue about social policy issues.

Signed into law two years ago, the Patient Protection and Affordable Care Act attempts to make health care more accessible to Americans. Census data show that about 1.6 million North Carolinians are uninsured — a situation that Dr. Craigan Gray, the director of North Carolina’s Medicaid Program, said comes at a hefty price.

“The uninsured are less likely to seek preventive care, and as a result, they end up sicker, come to the emergency room later and they enter into the stream of health care at a very expensive point in the health care continuum,” Gray told the crowd of about 100 seniors.

But the controversial health care reform law that aimed to curtail this problem faced immediate objection. A total of 26 states (though not North Carolina) are challenging its constitutionality.

Historically, the state-federal Medicaid program provides health care for the needy, aged, blind, disabled and low-income families with children. But the Affordable Care Act requires that, beginning in 2014, state Medicaid programs will be expanded to cover all individuals under 65 with incomes at or below 133 percent of the federal poverty level.

An estimated 16 million people will gain coverage through the Medicaid expansion by the year 2019, according to a report from the Congressional Budget Office, a nonpartisan agency that analyzes budgetary and economic issues.

In North Carolina, more than 600,000 people may gain coverage, Gray said, adding: “That increases the program by about 50 percent, to almost 2 million people. So by 2019, of the 9 million people in our state, 2 million will be on Medicaid.”

The state generally pays about 35 percent of the Medicaid program, with the federal government footing the rest of the bill. Under the new law, the federal government will pay all of the costs for the new Medicaid enrollees for the first three years of the program. By 2019, the federal government will pay 90 percent of those costs.

“The total cost to the state will be $830 million in state funds only. The federal share will be more than $15 billion,” Gray said. He paused and asked the audience, “Where are we going to find $800 million or $850 million state dollars in a time of fiscal frugality like we have never seen in this state for the last 30 years?”

The health care industry must also respond. As Mission Health CEO/President Ron Paulus told the audience, “In many ways, the drivers of reform are going to continue no matter what happens with the Supreme Court or anything else.”

Recalling his time as executive vice president for clinical operations at the Geisinger Health System in Pennsylvania, Paulus said part of reform concerns how patients receive care. Whether it was using online portals for appointments or using an interactive touch-screen questionnaire that showed how different choices lower risk for disease, Paulus said using these new systems changed patient outcomes for the better.

Paulus reported that no direct correlation exists between cost and quality of care, but a more efficient health care delivery system could be a major step in helping patients get the most for their dollar.

At Geisinger Health System, Paulus helped create an accountable care organization (ACO for short), an organization of health care providers that provides coordinated care to Medicare beneficiaries, and which is held accountable for the cost and quality of that care. He told the audience he’s trying to find ways to translate some of those health care delivery systems used at Geisinger to Mission Health.

“The concept behind ACOs is that some group of people, whether it’s doctors, or hospitals and doctors, or insurance companies, is that somebody has to come together and take responsibility for achieving a better outcome at a lower rate of increasing cost,” he said. ACOs were included in health care reform, he said, and they will be expected to impact the way health care is delivered.

For now, the effects of the Affordable Care Act remain to be seen. “We’re one of 50 states struggling with this,” Gray said. “Some people would question the use of the word affordable at the beginning of this act, but nonetheless, it's here and it’s the law.”

— Send your health-and-wellness news to Caitlin Byrd. She can be reached at 251-1333, ext. 140, or at


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