broken budgets.

"While the health-care reform bill gives the states extra money to help pay the costs for Medicaid services, no extra dollars have been identified for administrative functions," said Nathan Lewis, chief of program policy with the Florida Department of Children and Families. "Multiple systems are going to have to be able to talk to each other to support a population of recipients that doesn't exist today."

States such as Florida, he said, will need to find money to purchase new computers, increase data storage capacity for eligibility systems and beef up document imaging systems - not to mention the costs of hiring new workers to handle the increased workload. In addition, under the new law, states must upgrade eligibility systems to test recipients using the old and new criteria separately.

"We're going to have to reprogram the computer to recognize each of these populations and know how to treat them accordingly," Lewis said. "That means our Web-based application, eligibility determination and workload management systems will have to be modified as well as our interfaces with a variety of health-care agencies."

Health-care reform will force states to spend more on eligibility systems, but it also could trigger positive changes in how states operate Medicaid programs. For instance, eligibility determination traditionally is done in silos. The new law may bring systems together and force states to examine the roles of various agencies, according to Cindy Hielscher, an Accenture senior executive and leader of the firm's North American public health practice.

Under the new law, states also may be able to drive down Medicaid costs through value-based purchasing, quality reporting and a national pilot program to establish a bundled payment for specific services.

"Now there are incentives to change technology to focus on populations," said Steven E. Waldren, a physician and director of the Center for Health Information Technology with the American Academy of Family Physicians. "We can figure out how to deliver on quality, how to reach out to patients who don't come to see me."


2. Building Health Insurance Exchange Networks

Health insurance exchanges also will play a role in the eligibility process, according to experts at ACS, which processes 550 million Medicaid claims annually. Will Saunders, chief operating officer of the company's government health-care group, said that under the new law, states must build health insurance exchange portals that automatically determine Medicaid eligibility and direct qualifying patients to the Medicaid enrollment process.

By 2014, states must establish an online marketplace to make it easier for residents and small businesses to compare and buy affordable health insurance.

Cash-strapped states may partner to build regional networks, or they may use a template that will be developed by the U.S. Department of Health and Human Services. In any case, the purpose of these Web portals is to collect data from individuals in an interactive system that ties together treatments, outcomes and payments.

"How do you engage consumers in that process and allow them to request appointments online, do secure messaging, self-management, have glucometer and blood pressure machines record and submit data?" Waldren said. "That's how the Web portals start to be of higher importance and value."

Scheppach said the National Governors Association is still trying to gauge how many states intend to build their own insurance exchanges versus using the federal template. But he said states could use the exchanges to force significant changes in how health care is delivered to patients. Early on, as many as 50 million people will purchase health coverage through insurance exchanges, he told NASCIO members. And states will have the power to certify which insurers may participate.

"All of a sudden, states and governors have a fair amount of leverage in the marketplace," Scheppach said. "I would argue that it

Russell Nichols  |  Staff Writer