A big change to the state Medicaid program remains unfunded, increasing the risk of costly delays in Medicaid transformation.
The legislature adjourned without passing funding for Medicaid managed care — a transformation that will privatize Medicaid by paying managed care companies $30 billion over five years to cover 1.6 million low-income North Carolinians.
When the legislature returns Nov. 13 to tie up loose ends, lawmakers will have just days to approve money for transformation before they hit the deadline set by the state Department of Health and Human Services.
If they can’t clear the funding by mid-November, the rollout for Medicaid transformation will grind to a halt. But funding Medicaid isn’t included in the adjournment resolution, nor is it likely to be taken up in November, said Rep. Donny Lambeth, R-Forsyth.
Short of waiting until 2020, Republicans can shove the funding into a conference report, amend the adjournment resolution, or override the veto on the entire budget, said Gerry Cohen, former special counsel to the General Assembly.
“The legislature seems expert at jamming things into conference reports,” Cohen said. “There’s a way to do something, to bend the rules. … If they want to do something, they will do it. And if they don’t, they won’t.”
These tactics rely on Gov. Roy Cooper.
“A conference report needs a majority in each house to pass, but that strategy only works if they reached a deal with the governor,” Cohen said. “There’s lots of ways to get to the same dead end.”
Republicans seemed skeptical of using a conference report vulnerable to a veto.
“I don’t see how that would result in anything different,” said Pat Ryan, a spokesman for Senate leader Phil Berger, R-Rockingham. “From our perspective, taking out the same exact language and putting it in a different bill wouldn’t resolve anything. The governor has already vetoed it.”
The legislature already tried to pass funding with a mini-budget, House Bill 555. To make the bill less controversial, Republicans abandoned their plan to cut the budget for the state health department. Cooper still vetoed the mini-budget, calling for a more comprehensive action on health care.
“We’ve done everything we can to possibly fund Medicaid transformation, and they’ve all been blocked,” Ryan said. “There’s nothing else we can do.”
Cooper failed to respond to requests for comment.
DHHS Secretary Mandy Cohen warned that delays would be costly, both for taxpayers and for the insurers signed on as managed care companies. The managed care organizations have already hired staff for the multi-billion contract.
Without a budget, the state is also struggling to recruit providers. Less than half of providers who saw a Medicaid patient within the past year have signed on, and only three hospital systems have signed contracts.
“We have to be realistic. Since we don’t have [a budget], and we’re not likely to any time soon, she can’t tell providers what is in their contracts or rates,” Lambeth said. “And until you can do that, nobody is going to sign up. Not many hospitals or providers will be willing to take the chance to sign an open-ended contract.”
If funding remains stalled, insurers will bleed money, but many providers welcome delays. They don’t believe the program is ready for transformation.
Providers say patients will struggle with the provider directory. Unless other systems are also adequately tested, providers fear transformation will liken itself to NCTracks, a DHHS software disaster, said Cody Hand, N.C. Healthcare Association senior vice president of advocacy.
“We’re worried that the patients are going to get caught up in an untested system,” Hand said. “We’re worried about that same catastrophe involving patients.”
Lambeth suggests embracing delays, shifting the start date from February to July, and staggering rollout as late as September.
“I think it’s ultimately going to work out,” Cansler said. “But without the budget and without knowing exactly how many dollars they have to work with, the department is in a bad position right now.”