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CCNC Saves Money

CCNC Saves Money

Beneficiaries enrolled in CCNC spend less than similar beneficiaries who aren’t enrolled. While the estimated savings differ by patient populations and analytic approaches, the overwhelming evidence unequivocally says that CCNC saves money.

Evidence

Population Health Management (2013)

A study published in Population Health Management, a peer-reviewed journal, details the impact of CCNC’s approach to managing the care of a population of 169,667 non-elderly Medicaid recipients with disabilities, during the five-year period from January 2007 through September 2011. Enrollment in CCNC was associated with statistically significant cost savings, ranging from almost $190.91 per member per month (PMPM) in the first year to $63.74 PMPM in the last study year, with higher savings observed among patients with multiple chronic conditions. The authors estimate a total cost savings of $184 million over the 4.75 years studied, net of CCNC program costs. Additionally, the study found that inpatient admission and ED visit rates declined for patients enrolled in CCNC, while increasing among the unenrolled, even though CCNC was managing a sicker population over time. 

The full text of the Population Health Management article is available here

Milliman (2011)

A December 2011 analysis by Milliman, a national consulting firm based in California, found that CCNC saved the State of North Carolina nearly a billion dollars in health care costs over the four-year period from fiscal year 2007 through fiscal year 2010. The year-by-year breakdown is noted below. See the Governor's Press Release and Milliman's Executive Summary for more information.

State Fiscal Year Per-Member, Per-Month Total Annual Savings
2007 $8.73 $103,000,000
2008 $15.69 $204,000,000
2009 $20.89 $295,000,000
2010 $25.40 $382,000,000

Treo Solutions (2011)

An analysis by health care analytics consultant Treo Solutions found that CCNC saved nearly $1.5 billion in health care costs from 2007 through 2009.

Using the unenrolled fee-for-service population, risk adjustments were made by creating a total cost of care (PMPM) set of weights by Clinical Risk Group (CRG), with age and gender adjustments. This weight set was then applied to the entire NC Medicaid Population. Using the FFS weight set and base PMPM, expected costs were calculated. This FFS expected amount was compared to the actual Medicaid spend for 2007, 2008, 2009. The difference between actual and expected spend was considered savings attributable to CCNC.

Kaiser Family Foundation

A report published by the Kaiser Family Foundation on the Average Annual Growth in Medicaid Spending from FY2007 through FY2010 found that North Carolina had the lowest cost growth in the nation during that period.

A comparison by CCNC of these growth trends with the level of capitated managed care penetration in all states shows no correlation between the extent to which a state embraces capitated arrangements with managed care organizations and slow growth in costs over the period reviewed. This demonstrates that capitation is no sure route to “bending the cost curve.” Details on the state-by-state figures used in the illustration below are available through Commonwealth Fund Report (see page 15) prepared by Manatt, Phelps & Phillips, LLP.

Mercer

Earlier studies by Mercer estimated CCNC savings as:

State Fiscal Year Estimated Savings
2005 $77 - $81M
2006 $154 - $170M
2007 $134 - $149M
2008 $156 - $164M
2009 $186 - $194M