PAGE 6
iHE Yancey journal July u s 1977
Medicaid Budget Jumps
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In its effort to curtail the
escalating cost of North
Carolina’s Medicaid program,
the General Assembly has
\ approved several changes
, that are estimated to help
r reduce the total cost of the
t program by $40.8 million
during fiscal year 1977-78.
Savings in state funds will
amount to $11.5 million.
Even with these cost
containment measures enac
ted, payments to Medicaid
providers are budgeted to
jump from $256 million during
the 1976-77 fiscal year to
$277.7 million during 1978-79
and $304.9 million during
1978-79.
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The most drastic change is
the elimination of dental
services for adults covered by
the program. Dental services
will still be provided for
children through the Early
Periodic Screening Diagnosis
and Treatment program. It is
estimated that $16.5 million
will be saved in federal, state
and local funds by dropping
this service for adults.
During 1976, there wre
2010 dentists across the state
enrolled in the Medicaid
program. Less than half of
these were paid over 51000
during the year for treating
Medicaid patients including
both adults and children.
The next largest savings
adopted by the Legislature
was the freezing of Medicaid
payments to providers at the
same rate they were being
paid as of April 1, 1977. The
freeze in rates does not
include hospital inpatient care
(general, mental and specialty
hospitals), intermediate care
facilities for the mentally
retarded, and drugs. Anticipa
ted to. al savings by this action
are estimated at $10.6 million
for the year.
This action means that
individual practitioners such
as physicians and dentists will
be ' throughout the
1977-78 fiscal year at the
same rates that were in effect
as of April 1, 1977.
During 1976, there were
5,673 North Carolina physi
cians enrolled in the Medicaid
program with only 1,878 of
these being paid more than
SIOOO during the year for
treating eligible patients.
The Legislature has man
dated the Medicaid Pharmacy
Program to implement an act
to authorize pharmacists par
ticipating in the Medicaid
program to substitute generic
drugs for brand or trade name
drugs in the absence of a
prescription specifically to the
contrary. This action coupled
with an appeal to physicians
to prescribe generic drugs
instead of brand name drugs
is estimated to save a total of
$4 million.
Some of the Medicaid
Services provided recipients
at present require a small
co-payment by the recipient to
receive the service. The 1
amount of this co-payment
has been increased in some
cases by the latest legislative
action which should result in a
savings of SIBI,OOO.
Payments to nursing
homes for medicaid patients
have been frozen at the
maximum rate of $28.00 per
day and intermediate care
facilities $23.30 per day.
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Another action taken re
garding the transfer of pro
perty at less than tax value in
order to be eligible for
Medicaid is estimated to save
$1 million. This savings will
occur predominantly in future
cases where elderly persons
have given their property to
their children so they will be
able to become eligible to go
into a nursing home under
Medicaid as has been happen
ing in the past. The new
policy will make a person
ineligible to receive medicaid
services for specified periods
of time after the property is
transferred; Specifically, per
sons whose Homes are valued
from SIOOO to SSOOO will be
ineligible for one year, from
$5,001 to SIO,OOO for two
years and over SIO,OOO for
three years. This change will
affect future applicants only.
The legislature has also
initiated action to save $2
million in hospital inpatient
care by limiting the number of
administrative days to three
that a Medicaid recipient can
stay in the hospital for any
period of hospitalization. Ad
ministrative days are those
days in excess of days
certified as medically ne
cessary for the active treat
ment of the diagnosed condi
tion under the Hospital
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to Fit the Entire Family J
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DOMESTICS j
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1 TENT 10 1 14 REO. *loj*’ *B9®® A
LIFE VEST REG. *4« 7 $399 M
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Admissions Keview Program.
Hospitals will not receive
payments for excess-adminis
trative days patients remain
in hospitals.
These are the major
cost-saving changes in the
Medicaid program enacted by
the General Assembly. Other
actions to help realize the
total savings are increased
efforts by the Division of
Social Services which is
responsible for the adminis
tration of the program to
collect third party payments
from insurance and other
sources, better utilization and
review procedures and the
prevention of fraud and