The 2012 Continuation Budget – Medicaid

As the NC General Assembly reconvened this week for their short session, lawmakers immediately set to filling the shortfall in funding for Medicaid services for the remainder of this fiscal year. SB 797 – Ensure Timely Payment of 2012 Medicaid Costs sponsored by Senators Brunstetter (R-Forsyth), Hunt (R-Wake) and Stevens (R-Wake) provides $205 million in additional funds for the Department of Health and Human Services (DHHS) to ensure that providers will be paid for their services to Medicaid recipients through June of this year. The bill received quick approval this week and has moved to the North Carolina House for review and approval. The House is expected to take up the bill early next week.

While the North Carolina Senate was moving SB 797, the North Carolina House was reviewing the Governor’s budget adjustment recommendations. After further review of the proposals, NCMS staff has identified a number of concerning elements of the Governor’s proposed adjustments. Some of those concerns include:

  1. The continuation of the higher percentage rate cut on providers from last year. You will remember back in 2010 when the rate cut that was imposed had to be increased to achieve 12 months of savings in less than eight months time. Then the Governor and the 2010 General Assembly chose to keep that higher rate cut going forward. That nightmare has come back again. Even though the state plan amendment outlined an adjustment back to just two percent for next year, the Governor is proposing to maintain the 2.7+ percent rate cut put into effect last year to achieve 12 month of savings in less time. The NCMS opposes this increased rate cut even though physicians are exempted from the cut.
  2. Another series of undefined, targeted rate cuts is listed in the budget without any detail.  These mystery cuts would come from changing certain reimbursements from fee-for-service to flat rates. While this may have merit, the lack of detail does not allow the NCMS or the legislative budget writers the detail to make a competent evaluation about the impact of these cuts.
  3. Increased savings targets and undefined savings programs for Community Care of North Carolina (CCNC). Physicians have been strong partners with the state for more than a decade now through CCNC. Your efforts have provided better care for Medicaid recipients and saved millions of dollars in costs that the state would have been responsible for otherwise. Proposals in this budget adjustment would add to the obligation already carried by CCNC again without the detail to understand what the proposal would be and how it would save money. CCNC works and should not have additional savings obligations that have not been vetted, properly developed and ready to go into action

Legislative staff for the NCMS has been hard at work making sure that North Carolina House and Senate budget writers are aware of these and other budget related concerns. It is important that we continue to educate our legislative delegations back home about the significant investment that it takes from each of your practices to be able to care for Medicaid patients. Additional rate cuts, administrative burdens, prior approval obligations and service limitations only make care delivery harder for you and obstruct the quality outcomes that you are working to provide for your patients.

The North Carolina House is expected to release their budget proposal early next week. NCMS will provide a complete analysis of that budget proposal once it is available. In the meantime, physicians can contact the members of the North Carolina House Appropriations subcommittee on Health and Human Services to tell them about these concerns and others related to Medicaid by clicking on their name below.  Members of the North Carolina House Appropriations subcommittee on Health and Human Services include:

Rep. Avila (R-Wake) (Chairman)

Rep. Burr (R-Stanley) (Chairman)

Rep. Brisson (D-Bladen) (Vice Chairman)

Rep. Hollo (R-Alexander) (Vice Chairman)

Rep. Murry (R-Wake) (Vice Chairman)

Rep. Current (R-Gaston) (Member)

Rep. Earle (D-Mecklenburg) (Member)

Rep. Farmer-Butterfield (D-Wilson) (Member)

Rep. Insko (D-Orange) (Member)

Rep. Jones (R-Rockingham) (Member)

Rep. Parfitt (D-Cumberland) (Member)


Share this Post