Legislative leaders and Gov. Pat McCrory gave a general outline Friday of how they plan on changing the state’s $13 billion Medicaid program, a program that affects 1.5 million North Carolinians and accounts for one of the state’s biggest expenditures.

House Speaker Thom Tillis, Senate leader Phil Berger and McCrory issued a joint press release Friday morning that says the Republican leaders will use the Senate budget plan to have the N.C. Department of Health and Human Services draw up a waiver proposal to ask the federal government for the Medicaid changes.

The Medicaid program uses a combination of federal and state funds to provide required health care for more than 1.5 million low-income of North Carolina’s disabled citizens, elderly residents and children.

The announcement of how the reform effort will progress came a month and a half after McCrory and his Department of Health and Human Services Secretary Aldona Wos announced they wanted to open North Carolina’s Medicaid program up to potential privatization.

Today’s announcement is the first time the McCrory administration has outlined how the path to reform will take place.

Though still light on details, it says that the Senate budget plan (which will be released to the public Sunday night) will include a provision calling on DHHS officials to draw up a waiver that will then be submitted to the federal Medicaid program for approval. The Senate budget is also expected to include a controversial tax reform proposal that will cut income and business taxes, and create a need for $1 billion in cuts over the next three years.

The Medicaid waiver will be subject to legislative approval as well, before being sent off to the federal government.

“The federal government must allow North Carolina to come up with its own solution,” McCrory said in a written statement. “We have a unique opportunity in North Carolina to ensure patients and taxpayers achieve the common goal of provide the best possible patient care in a system that is financially sustainable.”

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Given the extraordinarily negative public reception to Governor Pat McCrory’s idea to privatize the NC Medicaid program and the way it fell flat in its first presentation at the NC General Assembly, you might be forgiven in thinking that this particular Medicaid “reform” was dead in the water in NC.  Unfortunately you would be wrong.

Today Governor McCrory issued a press release saying he would be coordinating with the Senate and House to require the Governor’s Department of Health and Human Services to request a Medicaid waiver from the federal government.  This federal waiver would allow NC to make unspecified changes to Medicaid and “create a predictable and sustainable Medicaid program for taxpayers.”

Let me translate this for you.  The only reason for NC to get a “federal waiver” to change its Medicaid program in this way would be to give NC the option to sell parts of the Medicaid program off to private companies – which has been the plan here all along.  Why?  Because if you sell off part of our Medicaid program to a private health insurer like Amerigroup at a price lower than we pay now for delivering the same Medicaid services, then the General Assembly frees up some money in its budget.  And how does a private out of state insurance company deliver the same health services for a lower price to moms and kids on Medicaid?  They make it harder to get health services and they lower significantly the rates they pay to doctors and hospitals for delivering care.  [My collegue Adam Linker explains how this shell game works - and how it has failed miserably in other states.]

So, what’s the big ticket item that the NC Senate and House would like to have more money for?  Their tax plans, of course.  The House and Senate tax plans would each cost NC over $1 billion and both the House and Senate plans would shift the tax burden onto low and middle income taxpayers, requiring a majority of taxpayers to pay more while the wealthiest people pay less.  Both plans leave the state with less revenue and NC has to balance its budget, hence the rush to privatize Medicaid and free up a few dollars for those big tax cuts for the wealthy.

In a scathing editorial this morning, the News and Observer called Pat McCrory’s DHHS Secretary Aldona Wos to account for her ignorance on basic decisions about Medicaid, a program she seeks to radically change through privatization.  Referring to Wos’ recent claim that the Commissioner of Insurance was responsible for rejecting billions of dollars in federal money for extending Medicaid, the N+O reminded the Secretary that the General Assembly and McCrory had actually rejected the federal money, noting that this action was: “an ideological and political stance, and it was a horrible decision.”  The main point:

Wos needs to be fully informed as to the state of Medicaid before she takes her show on the road, the intention of the show being to get community input, including comment from doctors, as to how the state can best deliver care.