As noted in this space last Friday, the rules of the North Carolina House of Representatives clearly require that lawmakers refer the conference report on the 2016-17 budget to a standing committee for review prior to the full House vote that is scheduled for tomorrow.

House Rule 44(b) states that:

“a conference committee report which includes significant matters that were not in difference between the houses, shall be referred to a standing committee for its recommendation before further action by the House.”

House Speaker Tim Moore

House Speaker Tim Moore

The obvious point of this rule is to prevent lawmakers from cooking up new law changes that were not included in either of the original versions of the bill passed by the House or the Senate and then inserting them in to a conference report that’s negotiated and drafted in secret. It is, in other words, a modest but important rule to assure a modicum of sunshine and transparency so that rank and file lawmakers, the news media and the public at large can have at least some idea of what the hell it is that’s being voted on.

Though everyone is still sifting through the massive 429 page document, here are two significant matters that are in the conference report that were not in either version of the budget passed previously:

#1 – As Chris Fitzsimon pointed out this morning, the conference report includes a new and hugely destructive provision to undermine light rail plans in the Triangle.

#2 – A new, out-of-whole-cloth change to state law on the number of so-called terminal groins that will be allowed along the coastline (see page 207 of the report).

These are both extremely important law changes that were never approved by either House throughout the eight month-long legislative session. Read More


News reports this morning continue to advance the notion that state lawmakers will come together on a state budget prior to the expiration of the current continuing resolution next Friday. As most reports have noted, the issue is made more complex by a House rule that requires 72 hours of public notice prior to the final votes on the budget. This means that lawmakers have to cut their final deal and get it published by the beginning of next week in order to meet the deadline.

While this may, indeed, be possible to pull off, it is worth noting that another House rule could impact the timing of next week’s process as well.

House Rule 44(b) (click here and go to page 21-22) reads as follows:

(b) The conference report may be made by a majority of the House members of such conference committee and shall not be amended. If the Senate has a similar rule, only such matters as are in difference between the two houses shall be considered by the conferees, and the conference report shall deal only with such matters. If the Senate does not have a similar rule, a conference committee report which includes significant matters that were not in difference between the houses, shall be referred to a standing committee for its recommendation before further action by the House.

The matter at issue with this rule is the question of inserting new items into the conference report that were not in the versions of the bill passed by either body. The common sense principle is that conference committees established to work out the differences between the two houses ought not to be adding completely new provisions out of thin air that were never in either version of the bill.

Not surprisingly, the wild and crazy Senate has no rule barring such shenanigans, but the House (see above) does. The clear impact of this rule is to require, at a minimum, an additional House committee meeting (presumably of the Appropriations Committee) to consider the new provisions added by conferees.

This means that if, for instance, the final conference report has a provision on the construction of terminal groins along the coast (something that was not in either version of the budget) the House must have a committee meeting to consider and approve such an addition. And while such a meeting could, presumably, be put together in relatively short order, it does offer the prospect of at least some minimal public airing of the details of what is sure to be a massive, secretly negotiated document.

Let’s hope House Speaker Tim Moore does the right thing and enforces this rule.


Since 1978 North Carolina’s Medicaid program has been managed by the Division of Medical Assistance, which is within the NC Department of Health and Human Services (DHHS). As the state’s Medicaid program stands today, most Medicaid enrollees are categorically needy – in other words, aged, blind, disabled or very low-income families (including pregnant women). As Medicaid enrollment has grown from under 500,000 enrollees in 1978 to over 1.5 million enrollees in 2015 so have the expenditures. Even though Medicaid spending growth between 2007 and 2012 was less than growth in private health insurance premiums, many states are reforming Medicaid to enhance budget predictability, increase quality of care, and promote long-term cost savings as enrollment increases. NC is no different as both the House and Senate have recently released their plans for Medicaid reform.

The House Medicaid reform bill was discussed in a previous post, but here is a quick recap. The House reform bill aims to build upon the system NC already uses by establishing provider led entities (PLEs). As the transition takes place, the PLEs can rely on the expertise and knowledge of Community Care of North Carolina. This model is similar to an Accountable Care Organization (ACO) approach in that networks of providers such as hospitals and doctors take responsibility for not only coordinating patient care, but for the finances. This model moves away from the current fee-for-service payment model, which rewards quantity of medical visits and/or procedures over quality of care and ultimately increases costs to providers taking a capitation payment. Capitation payment allows for providers to take on financial responsibility as they receive one risk-adjusted payment per patient. Providers in an ACO work to refer patients to other providers within the network. It is important to note that patients can select a provider outside of an ACO at no additional cost. Finally, five million dollars has been provided to reform Medicaid over a five year period in the House bill.

The Senate budget provides 10 million dollars to reform Medicaid by 2017. Like the House Medicaid reform bill, the Senate also includes the transition from a fee-for-service model to a capitation payment model. One major difference is that instead of using one type of organization to provide care and take financial responsibility, the Senate’s version of Medicaid reform uses a hybrid model. NC would contract with outside Managed Care Organizations (MCOs) who would then work with regional PLEs to provide care to Medicaid enrollees. Another significant difference between the two reform bills is that the Senate’s version of reform would remove oversight of Medicaid from DHHS to a new Health Benefits Authority, an eight member board focused on Medicaid and NC Health Choice. What is interesting is that members of the board would be appointed by the Governor, President Pro Tempore of the Senate, Speaker of the House of Representatives, and Secretary of Health and Human Services .

No matter how NC lawmakers ultimately decide to reform Medicaid, there is one action that both versions fail to do – expand Medicaid to 500,000 North Carolinians in the coverage gap. The same waiver that policymakers will submit to CMS to reform Medicaid can also be used to expand Medicaid as many other states have done.


Raleigh’s News & Observer joins the growing list of voices to condemn the state House’s decision to attempt squeeze more money out of the vulnerable by increasing lottery advertising efforts to raise teacher pay:

“What’s next for Republican leaders of the state House? It’s a tantalizing question because their ideas, or perhaps that should be notions, about what to do to raise teacher pay are truly strange.

Sorry, but it’s hard to take seriously the House’s pay hike plan for teachers. The House’s proposed budget would give teachers about 5 percent more by boosting advertising for the state lottery. The idea is that more advertising will lure more people into the games, and their losses will become the teachers’ gain.

How is Speaker Thom Tillis going to address other revenue shortfalls? A rabbit out of the hat maybe? Or perhaps he’ll charge for a traveling stage show wherein he saws Gov. Pat McCrory in half.

A good many Republicans and Democrats seemed to be doing a double-take when it came out that the lower chamber’s budget figured to bump lottery advertising to 2 percent of sales instead of 1 percent. With more marketing, officials figure, the lottery would bring in substantially more money. The last fiscal year figure for net proceeds was about $480 million.”

Read the rest of the editorial by clicking here.


Rep. Deborah Ross leaves the NC House this weekend to become the general counsel with the Triangle Transit Authority.

The six-term lawmaker joins us on News & Views with Chris Fitzsimon Sunday to discuss the state budget, school vouchers, and offer a bit of advice to the current legislative leadership:

“The more that a legislator focuses on making the institution better, the better the state is. I just caution the current majority that the more they think about themselves, the less they are thinking about North Carolina,” said Rep. Ross.

To hear an excerpt from the radio interview, click below.

Former House member Grier Martin will succeed Ross.
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