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Bill blocking State Health Plan reforms passes House

CJ file photo
CJ file photo

The state House passed a bill Wednesday, April 3, limiting State Treasurer Dale Folwell’s plans to make the State Health Plan more solvent. But the bill may not get a hearing in the Senate, letting Folwell move forward.

House Bill 184 would block Folwell’s proposal to make hospital pricing agreements with insurers more transparent and pay hospitals a standard formula. Instead, the bill sets up a legislative study committee made up of representatives from hospitals, state employees, and other interested parties to recommend and later implement changes. The bill passed by a 75-36 vote after heated debate.

Folwell says the plan, which covers 720,000 state employees, retirees, and dependents, is less than 4 percent funded. It has about $35 billion in unfunded liabilities. Without reforms, by 2023 it won’t be able to pay providers. H.B. 184 would force taxpayers, state agencies, and government employees to pay more to cover higher insurance costs.

Some Republicans pushed back, saying their local hospitals would go broke if they immediately had to impose the new cost controls. Rep. Pat McElraft, R-Carteret, acknowledged the State Health Plan’s financial woes, but said taxpayers shouldn’t pick up all the costs. She urged the Senate to amend the bill, having larger hospitals (with bigger cash reserves) adopt its provisions first and phase in smaller hospitals later.

Rep. Donny Lambeth, R-Forsyth, said Folwell’s plan would jeopardize health care in rural areas. Lambeth backs reforms similar to the state Medicaid transformation now taking place. It shifts financial risks to doctors and hospitals by paying them a set amount of money per month to provide services and measure patient outcomes.

House Democratic leader Darren Jackson, D-Wake, said too many patients use hospitals for routine care because they lack health insurance. His solution was Medicaid expansion — a likely non-starter in the Senate.

Senate leader Phil Berger, R-Rockingham, has said he’s hesitant to micromanage the State Health Plan. The General Assembly turned management of the program over to the treasurer’s office several years ago. Berger spokesman Pat Ryan told Carolina Journal Wednesday Berger’s opinion hasn’t changed. He said whether H.B. 184 gets a Senate committee hearing depends on the chairmen of the committees who are assigned the bill.

Associate Editor Dan way provided reporting for this story.