Rep. Nelson Dollar (R-Wake), Chairman of House Appropriations, released a committee substitute today that would provide an alternative resolution to the budget negotiations currently underway between the House and Senate chambers.  SB 3 – 2014 Budget Modifications / Pay Raises / Other Changes can be read here.

Two major changes in Medicaid were included in this new “mini-budget.”  The first is the creation of a $134 million dollar risk reserve for Medicaid.  The reserve would be managed by the Office of State Budget and Management (OSBM) and only available in the event that Medicaid overages could not be managed within the current fiscal budget allocated to Medicaid.

The second change would carry forward the existing 3 percent rate cut that went into effect this past January.  This carry forward cut would be in lieu of additional rate cuts being discussed.  No other eligibility reductions, services eliminations or payment cuts are included in this budget proposal.

We will provide additional analysis in the coming days as SB 3 moves forward.  The outcome of this bill is not certain nor is its impact on broader budget negotiations.  Watch our website for updates in the coming days.