One of the questions I am asked the most is about whether America should have a single payer for healthcare. The idea sounds compelling to many, but I argue in Health Attitude the economy of scale would turn into a diseconomy of scale. Bigger is not always better. We have 50 states and all are big enough to manage healthcare based on their unique needs. States are different.

Medicaid has a program called Section 1115 that provides states waivers to test experimental, pilot, or demonstration projects not meeting federal program rules. Thirty states have requested waivers tailored to specific needs of the states. Such requests are typically proposed to achieve more effective coverage, improved quality, or cost savings by doing things a different way instead of the Federal way. The Centers for Medicare & Medicaid Services (CMS) agreed and approved the requests.

Today’s WSJ has a story about how Connecticut has taken a unique approach to Medicaid which seems to be working. Most states have a managed care program for Medicaid administered by health insurance companies. Connecticut decided to eliminate the insurance companies and pay the healthcare providers directly. The state added a special feature called the patient-centered medical home (PCMH). The PCMH is a great concept. It puts primary care physicians in charge of coordinating the health of patients. The PCMH encourages outreach and care management by doctors, nurses, and other providers, not by insurance companies. The results are showing reduced cost per patient and more satisfied patients.

See the full story: Connecticut Bucks Trend on Managing Medicaid