Medicaid overhaul

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The Alabama Legislature passed a sweeping revision to Medicaid that replaces the way the program delivers and pays for care with regional managed care operators.

Under the legislation passed Tuesday, the State Medicaid Agency will no longer bear financial risks but will instead assume the role of contract administrators. Savings of $50 million to $75 million over five years and future cost containment is expected.

Privately owned Regional Care Organizations won't deal directly with patients, but will contract directly with doctors to provide care.

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Representatives from community groups and managed care companies are lauding the Legislature's efforts to reorganize Alabama's Medicaid program.

Speakers told House and Senate members Tuesday that the proposal is a major first step, but they also voiced concerns for the bill before it goes to committees for public hearings and revisions.

The bill would change Medicaid from a fee-for-service program to a program where private-sector contractors develop care networks in up to eight regions of the state.