Government Technology - June 2008 - (Page 23)

THE CHOKEHOLD OF MEDICAID is tightening on state budgets. The joint federal/state program, which serves as health insurer of last resort for almost 60 million low-income citizens, accounts for 22 percent of total state spending, according to the National Governors Association (NGA). As baby boomers approach retirement and the national economy nears a possible recession, pressure is mounting. Medicaid spending was projected to grow by more than 7 percent in 2007, the NGA said, driven largely by recent changes in prescription drug coverage. And health-care costs will continue rising at an average annual rate of about 8 percent over the next 10 years, according to Congressional Budget Office projections. “[Medicaid] is the largest budget item in just about every state. It’s now a massive insurance program, and states are increasingly running up against shortfalls,” said Ray Hanley, former director of Arkansas Medicaid and now client executive of Electronic Data Systems (EDS). “Medicaid is the last bastion of the otherwise uninsurable. About 50 percent of all deliveries in every state are funded by Medicaid. They get the frail, blind, lame, high-risk and handicapped infants,” he added. “Medicaid supports the long-term care industry. In every state, from 75 to 80 percent of nursing home recipients are on Medicaid. Medicaid supports the majority of the mental health industry.” Emerging state IT projects show how agencies can use technology to cut Medicaid costs, and quantifying the various cost drivers is often the first step. That measurement process is helping states identify and remedy the inappropriate service usage, late diagnoses and fraud partially responsible for surging Medicaid expenses. Unburdening the ER People often think of hospital emergency rooms (ER) as default destinations for treating ailments better suited for personal doctors’ offices, said Mike Fogarty, CEO of the Oklahoma Health Care Authority (OHCA). Most states identify inappropriate ER visits as a primary factor driving up Medicaid costs. Oklahoma devised an IT strategy that cut ER visits by 42 percent, resulting in $8.3 million in Medicaid savings to date. The OHCA tracked Medicaid patients’ ER visits and flagged inappropriate visits for corrective intervention. That meant contacting those patients after the visits to clarify proper ER use. However, often those 23 ANDY OPSAHL | FEATURES EDITOR http://www.govtech.com

Table of Contents Feed for the Digital Edition of Government Technology - June 2008

Government Technology - June 2008 Contents Point of View The Last Mile Big Picture On the Scene Four Questions For... 3 Technologies That May Change Your Job ...And Your Life Loosening Medicaid's Grip Better Living Through Technology Immersive Itineraries Help Yourself Taking the Bait Shared Connection Up Close Spectrum Products Personal Computing signal:noise Digital Communities Contents Digital Tactics for a U.S. Recession E-Dilemma Stifling Community Innovation Leadership Interview Estonia Becomes E-Stonia If It Were Up to Me …

Government Technology - June 2008

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