NC Senate proposal would reshape Medicaid

A bill that calls for the privatization of Medicaid using a mix of commercial insurers and in-state health care providers began moving through the Senate on Thursday, but it was unclear how much of the newest proposal the state House likes.

The legislature has been talking about multiple changes in the government insurance program for the poor, elderly and disabled, but the House and Senate have been far apart on the details for more than a year. This latest Senate proposal comes after months of discussions between Republicans in the two chambers.

Sen. Ralph Hise, a Spruce Pine Republican, called the bill a compromise.

“I feel like we’re in a good place to move forward with this bill,” he said.

But the bill does not appear to be the agreement that ends the lingering impasse.

Rep. Donny Lambeth, a Winston-Salem Republican who has been part of the negotiations, would not answer questions about the Senate proposal.

“I don’t have anything to talk about right now,” Lambeth said.

House Speaker Tim Moore said the Senate has “come a lot closer to the House” position, but “Medicaid is still a work in progress.”

The one critical area of agreement is that the state should stop paying for each office visit and procedure, and instead pay a per-person charge for enrollees’ care. Under this changed payment system, the government would not be responsible for health care cost overruns.

But the Senate wants a mix of commercial managed care and “provider-led entities” – networks of hospitals and doctors – to manage the money and patient health, while the House has proposed allowing only provider-led entities.

The latest Senate proposal calls for three statewide contracts that would likely go to commercial insurers, and up to 12 regional contracts for provider-led entities. The state would be divided into five to eight regions.

Having both commercial and provider-led networks guards against problems other states have had when insurance companies demand higher rates after signing up patients, Hise said. If an insurance company decides to pull out of the state, patients would have other options, he said.

The Senate dropped its call for a new Medicaid office run by a board of political appointees. Instead, it would set up a new cabinet-level Department of Medicaid, with a secretary appointed by the governor and confirmed by the legislature.

The Senate bill ends payments to Community Care of North Carolina, the network the state has used for years to coordinate patient care, by May 1. Some of the money saved would be used to raise Medicaid rates paid to primary care doctors.

The state would need approval from the federal government to make the proposed changes.

This story was originally published August 6, 2015 at 6:12 PM with the headline "NC Senate proposal would reshape Medicaid."