"There's nothing that says the same entity has to run care for the entire Medicaid population," Williamson told the Joint Legislative Committee on Medicaid Policy at the Capitol Tuesday.
Williamson is the head of a state commission the governor appointed to reform Medicaid, with an eye toward cutting the program's costs. A joint federal-state program, Medicaid provides health insurance to Alabamians living below the poverty line. The state's share of the program, projected to cost $603 million this year, has increased significantly since the 2008 economic crash.
Williamson's group, the Medicaid Advisory Commission, has until February to come up with a plan to revamp the program. So far discussions have revolved around two options: turning Medicaid over to a commercial, for-profit managed care organization or creating a similar managed care program based on non-profit community health organizations.
But it's not clear that legislators will go for either of those options. Tuesday's meeting of the Joint Medicaid Policy Committee was the first meeting legislators have held on the topic in months. Some lawmakers indicated they wanted more options.
Committee chairman Rep. Greg Wren, R-Montgomery, said leaders in the House and Senate had a plan that included capping the total cost of Medicaid as a percentage of the General Fund and clamping down on fraud and abuse in order to cut costs. Both are options Republican leaders in the Legislature had mentioned early in the Medicaid reform process.
"Gone will be the years of simply feeding the Medicaid budget … with the assumption there's nothing the state can do" to cut costs, Wren said.
The Medicaid Advisory Commission has worked on the assumption that costs will be capped, but no specific numbers for a cap have been proposed. Williamson said the Medicaid Agency will soon take bids for an independent auditor to root out Medicaid fraud. Still, he said, it's the increase in enrollment, rather than fraud, that is the source of the program's rising cost.
Rep. Rod Scott, D-Fairfield, wondered whether the two proposed options — both of them forms of managed care — were really the only two possible solutions.
"Are we really laying out the options that we have?" he asked, saying there might be additional alternatives the committee hasn't considered.
Williamson said the state may not be faced with a choice between the managed care and community care approaches. The state could set both systems, he said, to cover different parts of the state.
Medicaid patients in Florida are offered a choice of care plans, said Tarren Bragdon, chief executive officer of the Foundation for Government Accountability, a Florida-based conservative think tank.
Bradgon presented the committee with a plan to open up a similar multi-provider marketplace in Alabama.
Florida's system "is agnostic about the type of plan that's best for the patient," he said, saying it was better for clients to make that decision.
Increasing revenue to pay for the program is an option that, so far, has seen little support. A bill filed last year would have boosted cigarette taxes by $1 per pack, a sum that supporters said would have filled the Medicaid hole. That bill failed, but a similar, smaller cigarette tax is proposed in a bill now pre-filed in the Legislature.
The legislative session begins Feb. 5, by which time the Medicaid Advisory Commission is expected to have a reform proposal. So far, the commission has not had a clear idea of how much money would be saved by either proposed reform option.
The commission asked for estimates on both proposals, and may hear those proposals at a meeting this afternoon.
Capitol & statewide correspondent: 256-294-4193. On Twitter @TLockette_Star.