The state Senate on Monday night tentatively approved its latest version of privatizing Medicaid, by a 38-10 vote.
The final vote is scheduled to take place Tuesday, and then the bill will be returned to the House for consideration. It isn’t clear if the House will go along with the changes.
The legislation, House Bill 372, calls for a mix of commercial insurers and in-state health care providers, and a change from the current fee-for-service system to a per-member monthly cost. That is meant to encourage patients and medical providers to control health-care costs.
The state would not be responsible for overruns – bringing more certainty to a volatile piece of the state budget that involves billions of dollars each year.
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A new cabinet-level department would be created, with a secretary appointed by the governor and confirmed by the legislature.
Sen. Angela Bryant, a Rocky Mount Democrat, wanted to know how the state would monitor companies to make sure they aren’t denying services in order to meet cost goals.
Sen. Ralph Hise, a Spruce Pine Republican who is sponsoring the bill, said people would be able to change providers if they were unhappy with one plan. He added that companies denying services would run the risk of losing their contracts.
The plan would allow three statewide contracts for commercial insurers, and up to 12 regional contracts for provider-led entities.
Sen. Glady Robinson, a Democrat from Guilford County, wanted to know how long it will be before the state takes care of the estimated 500,000 uninsured people who are not covered because North Carolina refused to expand Medicaid coverage. Hise said the best solution was improving the economy so those people can find jobs and become insured.
That brought an angry retort from Sen. Joel Ford, a Democrat from Charlotte, who said the problem is that the minimum wage is insufficient to support people who are employed but struggle to make ends meet. “I would ask you for a little more compassion,” Ford said.
Hise, in a committee meeting earlier in the day, said $10 million in state and federal money would be used to start the new department. Current Department of Health and Human Services employees in the Medicaid division would be evaluated to determine if their position was essential, and if so would be given 5 percent salary increases if they chose to work in the new department.
Employees in the new department wouldn’t have the protections of the State Personnel Act. The department would have flexibility in what it pays the secretary and other workers.
Hise also said there would be about $10 million in annual savings once the current Medicaid administration contract with the company that coordinates medical care for Medicaid patients is cancelled.
The program would grow at 2 percent below the average of the states that have not expanded Medicaid, which would amount to $80 million in savings each year.