Why advocates of new Alabama Medicaid system say 2016 is the year to fight for funding

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HUNTSVILLE, Ala. (WHNT) - We've heard from a number of parties involved that the governor may very well veto the budget he's presented by the legislature if it doesn't include enough funding for Medicaid.

Medicaid's proponents have focused on 2016 as a critical year.

Burr Ingram is the VP of Marketing and Communications at Huntsville Hospital. He met us in a conference room, complete with a whiteboard covered in scrawl, detailing the state's complicated Medicaid crisis.

He admits, "It's a very complicated situation to say the least."

To understand the current push, you first need to understand that Medicaid is primarily funded by federal dollars.

Alabama wants to move from their current fee-for-service model to a managed care model, headlined by Regional Care Organizations (RCOs). The RCOs create systems to manage individuals in the Medicaid system, helping them access preventative care along with emergency services. Huntsville Hospital would help serve that role.

The governor says it will control costs, but Ingram points out, "The state needed to get federal approval to move to this new mechanism, and they got it just recently."

If Alabama comes up short on Medicaid in the general fund, Ingram says, "We are concerned that the CMS, which is the Center for Medicare and Medicaid Services, the federal government's healthcare arm, will look at the future program and say, 'If you don't fund yourself currently, how can we expect you to transition to the new managed care model that you have said you want to roll out later this year?'"

So our plan to save money might get scrapped because we haven't set aside enough money to change from the old model.

To avoid going back to the drawing board, we're seeing proponents of the new model fight tooth and nail.

We spoke with Representative Phil Williams (R-Limestone/Madison County) on the issue. He says it's too early to say which way the issue will go, but he notes he's heard colleagues express doubts over the RCO system.

Williams says he expects Medicaid to be a major issue every year.

Meanwhile, the warnings from hospitals are ominous.

Ingram notes, "For every dollar of service in cost, we get about sixty cents from Medicaid." If Medicaid goes underfunded by the state legislature, that compensation could fall.

But Ingram says the sick people, "They come. A sick person with nothing is over in the emergency department right now."

Huntsville Hospital would wind up with extra uncovered costs that get passed along to other customers. Ingram puts it this way, "Anyone who uses our hospital eventually helps pay for those that can't pay."

In his discussion of the issue, Ingram mentions hospitals having to make tough choices, but as for what those are, he only says, "I think they always involve high-end services or services you can't keep up at the same level if they are services that do not pay for themselves. I don't think anybody wants to articulate anything at this point."

UPDATE: The governor's office has give us the following statement on the fight for Medicaid funding.

We are certainly still optimistic that Medicaid will not be cut the amount that has passed.  The Governor has said that he will veto a budget that does not fund Medicaid.  The Governor has worked hard over the last few years to make Medicaid more effective and efficient for taxpayers and the people enrolled.  If the agency is cut $100 million, we lose the progress that we have made to remodel and streamline the way Medicaid works.  A special session is an option, but there is no timeline until a final budget passes.

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