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The N.C. Department of Health and Human Services released a cheerful video this afternoon touting the supposed successes of the state’s new Medicaid billing system that delayed payments for thousands of medical providers for months over the last year.

The nearly 4-minute video produced by state employees includes interviews set to upbeat instrumental music with several providers and DHHS officials talking about how well the complicated Medicaid billing system is working one year after its bungled July 1, 2013 launch.

Much of the system is working now, and providers are getting paid faster than before, DHHS officials say in the video.

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 N.C Tracks replaced the state’s previous 25-year-old Medicaid system and came online despite warnings in a May 2013 performance audit from the state auditor’s office that DHHS hadn’t fully tested the system, left too much up to vendors’ discretion and had no way of knowing ahead of time if the system was ready.

The billing problems have left legislative fiscal research staff without firm budget numbers on the $13 billion program, a major point of contention in the current budget negotiations for Republican state Senate leaders.

Missing from DHHS’ birthday video were some of the choicer statements doctors, lawmakers and others have had about new system and its rollout last year under N.C. DHHS Secretary Aldona Wos.

Here’s a few of the less-than-glowing comments:

  • “NCTracks has made billing go from complex to borderline impossible,” said Sandra Williams, chief financial officer of Cape Fear Valley Health System, at an October legislative hearing.
  • “NCTracks was a disaster, and the State was beyond the point of no return,” lawyers wrote in a lawsuit filed by medical providers in January against the state agency.
  • “We are pretty much in the dark with trying to figure out where we are in the current year,” said Susan Jacobs, a fiscal analyst for the legislature in January about getting budget data from N.C. Tracks.
  • “It’s June 19 and we still don’t have the numbers,” Sen. Tom Apodoca, a Hendersonville Republican, said in a hearing earlier this month about Medicaid budget information, according to the News & Observer. “If push comes to shove, we can always issue subpoenas.”
  • “We are having to manually key claims and do things that before would pay automatically,” Laura Williard of High Point’s Advanced Home Care told WNCN in early June. “At one point, I had 11 temps working for our company to do something that was paid automatically before.”

…is highlighted in this fine editorial in the Charlotte Observer entitled: “Expand Medicaid – It has value in NC.” To quote:

“N.C. lawmakers don’t seem inclined to reconsider their unwise decision not to expand Medicaid. But that doesn’t mean we should stop shouting loudly why they should. A new Robert Wood Johnson Foundation report last week underscores the value for the Tar Heel state.

The report looked at the Affordable Care Act’s impact in 14 large U.S. cities. Charlotte was among the seven cities in states where lawmakers opted not to expand eligibility for Medicaid. Even so, the number of uninsured Charlotte residents is expected to drop by 36 percent, or 63,000, by 2016 because of ACA. That was the highest drop among cities with no Medicaid expansion. Among all states, North Carolina has the fifth-highest ACA federal online sign-up.

The report points out that had North Carolina expanded the state’s Medicaid program for low-income and disabled residents, the decrease in uninsured in Charlotte would be even greater – an estimated 57 percent. That would be an additional 36,000, bringing the number of Charlotte residents gaining insurance to 99,000 by 2016. Read More

In a good conversation with Becki Gray yesterday on News 14 we discussed the different visions for Medicaid reform proposed in the respective budgets of the Governor, House, and Senate. In particular, Gray, who works for the John Locke Foundation, noted that the state has a “rich” benefits package in Medicaid because we offer many optional services, that is, services that are not required to be covered by the federal government. The Senate, she correctly pointed out, wants to whittle away these optional services.

Ending optional services in Medicaid is a popular policy among conservative think tanks in the state. Apparently the Senate is listening.

As this debate progresses it is important that we know what services we are talking about when we talk about optional services. Let’s review a few: transplants, prescription drugs, dentures, hospice, prosthetics. None of these treatments are frivolous or lavish.

And that’s the trouble with optional services. If you want to get at some of the more expensive options then you are limiting life-saving care. Former Locke Foundation analyst Joe Colletti even praised Arizona for cutting optional services like transplants in a report on Medicaid reform. But these cuts inflicted so much pain in Arizona that the state made a volte-face on its decision.

That brings us to the Senate budget. Among other things the Senate wants to end the optional Medically Needy program in Medicaid. This program allows people who have enormous medical expenses, but earn too much to qualify for Medicaid, to apply these medical bills to their income to access Medicaid. This makes sense. If, for example, you earn $30,000 per year but need expensive drugs or nursing home care then these costs will quickly eat through your monthly income. Although you may have some money your medical needs erase it all. It’s not fair to tell this person that he or she is too wealthy for Medicaid when they effectively have nothing.

But this is exactly what the Senate aims to do.

As we have said many times before, “optional” refers to a regulatory requirement and does not mean anything about the necessity or quality of specific Medicaid services. You may call it foolish for the state to cover optional services. I call it basic human decency.

 

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The House budget includes a requirement that the position of Medicaid Director be subject to confirmation by the North Carolina General Assembly. Here’s some of the language:

4         APPOINTMENT AND CONFIRMATION OF MEDICAID DIRECTOR
5         SECTION 12H.36.(a) Effective July 1, 2014, and applying to Directors of the
6         Division of Medical Services appointed on or after that date, G.S. 108A-54 is amended by
7         adding a new subsection to read:
8         “§ 108A-54. Authorization of Medical Assistance Program; administration.
9         …
10       (e) The Medicaid Program shall be managed by the Director of the Division of Medical
11       Assistance (Medicaid Director), who shall be recommended by the Secretary of Health and
12       Human Services and appointed by the Governor, subject to confirmation by the General
13       Assembly by joint resolution. [...]

This provision should raise many questions and concerns. The legislature does not have appointment authority over any other position that is so central to carrying out the policy agenda of the Governor. If, for example, the legislature is bent on limiting access to Medicaid while the Governor wants to streamline enrollment, then the conflict will likely shut down any ability to get a Medicaid Director in place.

And while there is a clear process to appoint a Director if the Governor does not forward a nomination, the budget does not spell out what happens if the legislature refuses every nominee from the Governor. What would most likely occur is that the Governor would have to wait until the legislature is out of session and then appoint a temporary Medicaid Director.

If all of this sounds familiar it’s because this is how the process works in Washington, DC, where politics clouds every decision and ties up the basic functions of government. Instead of fostering bi-partisanship and stability, Congress has caused major disruptions in the running of Medicare and Medicaid by refusing to approve presidential nominees.

The same is likely to happen in Raleigh.

The Governor, who is elected statewide, should be able to appoint his or her preferred Medicaid Director to carry out the policies that he or she was elected to enact. If this confirmation requirement survives negotiations between the House and the Senate then leadership elected in select pockets of the state will have veto power over how the Governor runs one of the most important agencies of the executive branch.

The folks at Carolina Public Press in Asheville have more responses from the trenches today in a story about the North Carolina Senate’s proposal to privatize Medicaid and do away with the state’s award-winning Community Care NC program:

“Medicaid management nonprofit faces closure

Community Care of North Carolina, a nonprofit with 14 networks across the state — including Western North Carolina — would lose its contract with the state under the Senate’s plan.

The proposed elimination of the nonprofit network is part of the Senate’s plan to remove Medicaid management from the state Department of Health and Human Services and create a new agency to handle the program, as noted in its budget document.

Community Care of Western North Carolina, which has an office in Asheville, serves eight WNC counties: Buncombe, Henderson, Madison, McDowell, Mitchell, Polk, Transylvania and Yancey, according to its website. It serves 64,342 Medicaid enrollees, according to July 2013 figures, with an additional 12,000 enrolled in other programs. Read More