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Governor signs Medicaid reform into law

By Beth Clayton
Alabama Political Reporter

MONTGOMERY–Governor Robert Bentley signed legislation into law yesterday that would reform Medicaid in Alabama. The Governor was joined by the SB340s sponsors, Senator Greg Reed (R-Jasper) and Representative Jim McClendon (R-Springville).

The law will establish regional care organizations (RCOs) to manage patient care, however it excludes pharmacies, dentists and nursing homes.

Governor Bentley explained that the law changes Alabama from a “fee for service” model to one based on outcomes and quality care.

“We were able to, with the governor’s signature today, wrestle to the ground what was one of the biggest gorillas that we had to deal with in state government,” Reed said.

Through the process of creating this legislation, Reed said that he was concerned about three groups: the patients who need care, the providers who give the care, and the tax payers who pay the bill. This legislation is “the best option we have” to address those three groups, he said.

Patients and doctors “are going to receive a better product for a lower dollar amount,” Reed said. “The impact on the individuals in our state is significant.”

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Dr. Don Williamson, state health officer, explained the difference in the outcome-based system by using the example of a patient with diabetes. Under the current system, a Medicaid patient may end up in the emergency room several times in one year, due to a variety of factors that may include lack of transportation to visit a doctor, lack of ownership in one’s own healthcare or lack of preventative care.

Under the new, outcome-based system, that patient would be responsible for checking in with a nurse daily to ensure that he or she is monitoring blood glucose levels and maintaining a healthy lifestyle, Williamson explained.

“They need to be educated on where they should go for the best quality care,” Bentley said. “They need management, and that is what we’re trying to do with this system.”

“Medicaid has come a long way since it first began in Alabama,” said Stephanie Azar, acting Medicaid commissioner. “Today, Medicaid is at the forefront of the health care industry.”

In addition to signing SB340, Bentley also signed an executive order to create a Medicaid pharmacy study commission with Williamson as the chair.

Under the new law, the Medicaid agency is responsible for establishing district lines for the regions by October 1. The governor denied that the expedited implementation timeline is in any way related to federal deadlines associated with the Affordable Care Act, and that he has no plans to expand Medicaid coverage at this time.

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Once the COVID public health emergency ends, millions will have to reapply for Medicaid or find coverage elsewhere.


Bentley said expanding Medicaid is not a political decision to be made, and is critical to saving lives.


Blanchard is on the ballot in the Republican primary for governor on May 24.


We have come a long way getting to this point, and Alabama is well-positioned for the future.