CHAPEL HILL – While some states are opting out of expanded Medicaid provisions in the Patient Protection and Affordable Care Act, state Rep. Verla Insko confidently predicts North Carolina will participate in the expansion despite a temporary spike in costs to the state.

“I don’t see North Carolina as one of those states that’s going to reject the Affordable Care Act,” or the creation of state health care exchanges to enroll uninsured people, Insko told Orange County education and business leaders on Tuesday.

Insko, who sits on the Appropriations Committee for Health and Human Services, was one of four Democratic lawmakers from Orange County speaking at the Chapel Hill-Carrboro Chamber of Commerce annual state legislative briefing, held at the Chapel Hill Country Club.

“Historically, you can see every year the Medicaid budget takes a greater percent of the entire [state] budget. That money has to come from somewhere, and I think it’s coming out of education by and large,” Insko said. “We really do need to get the cost of health care under control.”

But federal health care reform may not show immediate savings, she said.

“If you hear the cost is going to go up, there is some truth to that,” she said, because many new patients will be added to state Medicaid rolls.

“These people are sicker than the general population that’s been under care for a long time,” Insko said. After 12 to 18 months in the state’s Community Care North Carolina program under Medicaid, she said those patients will be able to control chronic conditions as treatments and ongoing care improve their health.

The federal government will pay 100 percent of the costs of Medicaid expansion for three years, after which it goes down to 90 percent. But that is when states will “start to see the savings” from patients requiring less care because they are on a preventative health regimen under a health accountability model, she said.

Insko predicted that in January the Senate will take up House Bill 126, which sets up a state health care exchange. Passed in the House, the legislation includes a variety of tax credits for businesses and nonprofit organizations that keep employees on private insurance rather than sending them to the health exchange.

“We don’t want the federal government to run our health benefit exchange,” Insko said.

Aaron Nelson, Chamber of Commerce executive director, worked with Insko on a task force molding the health care exchange model for the state.

“Imagine an Expedia or Travelocity for health care purchasing” and that’s what the exchange would be, a place where consumers can find multiple options for insurance, Nelson said.

Joining Insko on the panel were state Sen. Ellie Kinnaird and two retiring lawmakers, House Minority Leader Joe Hackney and state Rep. Bill Faison. They discussed significant issues that came before the General Assembly during the two-year session and lamented the direction that the legislative process and agenda have taken under Republican control.

Faison particularly was critical of what he viewed as a rush to approve hydraulic fracturing for pools of gas reserves in the state’s underground shale formations and what he characterized as a Republican majority hypocrisy on protecting property rights against oil and gas interests.

He unsuccessfully introduced three amendments to prohibit drillers from trespassing on private property.

“You own your own land and you own it all the way to the center of the Earth. You own what’s on top of it and you own what’s underneath it. You own the water that’s underneath your property and you’re entitled to control the subsurface,” Faison said.

“Two-thirds of fracking drilling does not go straight down. It goes sideways,” and it breaks up the subsurface rock as it crosses multiple properties to release the gas, Faison said.

His research showed that “trespass laws were eroded very quickly by the oil and gas interests” in Texas, Louisiana, Arizona, Colorado, and North Dakota. Two of his amendments would have banned modification of North Carolina’s trespass laws and the other prohibited an unelected regulatory board from weakening trespass laws.

“As a general proposition, the folks on the Republican side of the aisle will say they stand up for property rights, but I want you to know when confronted with whether to protect your water, your property, your property rights, or to make it possible for some of their more wealthy contributors to go ahead and go under your property and take what you have and use it as they will and pay what they decide to pay you, their choice is the latter,” Faison said.

On other items:

• Reforming North Carolina’s tax code is expected to be a major initiative in the next session. Insko said North Carolina needs to approve tax reform to include taxes on the purchase of more services to complement existing taxes on the purchase of goods. “North Carolina is actually far behind other states,” she said. Many have up to 300 categories of businesses whose services are taxed. North Carolina has “fewer than 25,” she said. Putting new taxes on the services of providers such as dentists, doctors, lawyers, Realtors, landscapers, and barbers will provoke backlash, Hackney said. “I want to see the person who votes to put a tax on the barber and then goes to the barber shop the week after. It ain’t gonna happen.”

• If Republicans maintain control of the General Assembly, look for the GOP to eliminate extraterritorial jurisdiction provisions that allow municipalities to control zoning and land use on properties outside their municipal borders, Hackney said.

• Kinnaird said new laws require municipalities to pay for extension of water and sewer lines right up to houses that are involuntarily annexed. In the past, property owners had to pay the cost to hook onto a main line and run their own pipes to their houses. “Really this means, I think, the end to involuntary annexation” because the costs would be too high for a municipality.

Dan E. Way is an associate editor of Carolina Journal.