Under the Dome

Legislators propose to move state Medicaid control to independent board

Republican legislators looking to solve the persistent problem of unpredictable Medicaid spending are proposing to set up an independent board to run the $14 billion government insurance program.

A proposed bill – nothing has yet been officially filed – that moved out of a subcommittee Thursday would set up an eight-member board. The state Department of Health and Human Services would be a nonvoting member.

The proposal calls for transferring the Medicaid program, now controlled by the state Department of Health and Human Services, to the independent board on Oct. 1.

The board would be required to keep Medicaid and a companion Health Choice insurance program for children within their budgets. It would have the authority to make mid-year cuts in services provided under those programs if budget overruns were projected. It would also have access to a Medicaid reserve account.

Legislators are looking for a way to avoid having to find money mid-year to fill Medicaid budget holes. This budget control would put Medicaid on par with other state agencies that must control their spending, said Sen. Ralph Hise, a Spruce Pine Republican.

“I don’t think it’s any different than where we encounter things in other areas of government, but it is different from what we’ve had historically in Medicaid,” he said. The legislature would continue to set Medicaid eligibility.

Rep. Verla Insko, a Chapel Hill Democrat, is concerned that the independent board deciding on health services would be too insulated from the people who depend on the insurance coverage – and not as accountable as elected officials for decisions.

The proposed Health Benefits Authority would have seven board members appointed by the governor and legislative leaders and would hire the state Medicaid director. Employees hired after Oct. 1 would be exempt from the State Personnel Act.

Board members would be paid, but no one would make more than the highest-paid member of the Council of State.

The proposal will go to the full Joint Legislative Program Evaluation Oversight Committee next week. It would still have to move through the regular bill-filing and approval process.