Under the Dome

SUNDAY DOME: A Medicaid cloud envelops the legislature

Chambers led by Senate leader Phil Berger (left) and House Speaker Tim Moore are nearing debate on a big budget item.
Chambers led by Senate leader Phil Berger (left) and House Speaker Tim Moore are nearing debate on a big budget item. cliddy@newsobserver.com

Nearly a year has passed since the state House and Senate sharply divided over money for the state’s Medicaid program – helping slow budget negotiations and extend the legislative session.

The legislature may be facing a repeat showdown this year, with even bigger consequences.

Sen. Ralph Hise, a Spruce Pine Republican and co-author of the health and human services part of the budget, tells Dome that both Senate leader Phil Berger and Rules Committee Chairman Tom Apodaca have warned that this year’s lawmaking session won’t end without a significant agreement on Medicaid changes.

Medicaid is one of the state’s major budget items, consuming about $3.5 billion of a roughly $21 billion state-financed spending plan.

When legislators talk about “Medicaid reform,” they usually mean changing it from the current fee-for-service plan where doctors, hospitals and other medical professionals get paid for each office visit and procedure into a program with funding that pays a group of providers or insurance companies a set amount for each person to then manage their care.

There’s agreement on the part of the House and Senate that the state should end fee-for-service but, so far, there’s not an agreement on who gets to control that money.

Will it be only groups of medical providers, which is what the hospital and medical associations want?

Will commercial insurance companies be able to compete by establishing Medicaid managed care operations of their own?

House leadership has been more in line with the hospitals and associations. The Senate wants a mix of “provider-led” and commercial Medicaid managed care in the state, Hise reaffirmed last week.

House and Senate negotiators have been trying for months to come to an agreement, but none appears close.

House and Senate bills on Medicaid reform have been filed this session, but sponsors say they’re placeholders.

The House budget is silent on what a Medicaid reform plan should look like, but sets aside $2.5 million in its budget proposal to fund it.

The Senate will put its preference for the provider-led and insurance-company-operated Medicaid managed care into its budget, Hise said.

Medicaid reform “will be part of any discussion we will have on what we will fund for the future years,” he said.

There’s another level of Medicaid changes under discussion that deal with the basic question of who should run it.

The House budget would give DHHS more freedom to make decisions about Medicaid. The Senate may move in the opposite direction in its budget.

Senate Republicans have been interested in partly or fully disconnecting Medicaid from the state Department of Health and Human Services. It had such a provision in its budget last year, and Hise said members are debating whether to include something like it again this year.

While the brinksmanship builds, companies and doctors with the most at stake are making their cases.

Community Care North Carolina, the state’s patient care coordination networks, put together a video showing that Medicaid claims spending has been flat over the past four years, and Medicaid claims per person have declined.

“If costs are not exploding, it changes the debate of what you want to redesign – the pace of redesign,” said Paul Mahoney, CCNC spokesman.

The N.C. Hospital Association and the N.C. Medical Society put together a proposal for provider-led organizations that would integrate all aspects of care, including dental, mental, and long-term care, within five years of federal government approval of the plan.

A coalition of insurance companies called NC Medicaid Choice is pushing for “Medicaid modernization” that includes managed care companies in the mix with provider-led organizations.

An organization called Carolina Partnership for Reform produces a steady diet of blog posts opposing Medicaid expansion and supporting managed care. Its blog characterizes the Medicaid budget as a “monster,” and derides the hospitals’ and doctors’ plan for taking too long to mature.

“Most states in our region spend less on Medicaid than we do,” says a blog post from May 27. “Most use managed care as part of their solution.”

Lynn Bonner

Veto override watch

Plans for a vote that would override Gov. Pat McCrory’s veto of Senate Bill 2, which exempts magistrates from performing marriages, appeared on the state House calendar twice last week – without any action. It has prompted a veto override watch, and the counting of bodies (read: votes), in the chamber.

Rules Chairman David Lewis, a Dunn Republican, noted last week that a number of Republicans were absent from sessions.

He wouldn’t say when the vote will happen, only that “we hope to be able to deal with this in a reasonable amount of time.”

“I think we have to have a full caucus together to be able to discuss any of the issues” related to Senate Bill 2, Lewis said.

According to records of Thursday’s votes, only two Republicans were absent: Rep. Rob Bryan of Charlotte and Rep. Lee Zachary of Yadkinville. Both of them voted for the magistrates bill last week. Also absent: Rep. William Brisson, a Bladen County Democrat who often votes with Republicans on social issues.

Lewis also raised the possibility that the House might not try to override McCrory’s veto. “I think we will see the bill remain on the calendar until we take a vote or the speaker determines we’re not going to,” he said.

McCrory urged speed. “There’s a lot of arm-twisting going on across the street,” he said. “I would hope and I encourage that they follow the process that I think the Constitution clearly spells out – to do it within a reasonable period of time.”

Lewis said some Republicans haven’t decided how they’ll vote on the override. “Frankly, some of our members are on the fence and are seeking legal counsel to ask certain questions,” he said. “I think they will get those answers and be able to make a vote based on their own conscience, their own heart.”

Colin Campbell