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NC Budget Compromise Stalls; Managed Care/Medicaid Bill Gets More Changes

Budget Update

Senate and House calendars have remained rather empty the past few weeks as we wrap up the third week of July without a budget deal. Last week, the leadership in both chambers exchanged another round of offers, but at the end of the day, there is no final budget adjustments bill. North Carolina is currently operating on a two-year budget that was passed during the previous legislative long session in 2013; typically, the General Assembly will return in the short session to make adjustments to that budget for the final year of the two years. One major issue still unresolved is teacher salary raises, which were not included in the existing budget that started on July 1, 2014. Teacher raises have been a major issue for both chambers. The House continues to stand by the need to give teachers a raise without gutting Medicaid and teaching assistants. The Senate in the most recent round of offers moved toward the House’s position on some of the Medicaid eligibility changes and split the difference on teacher assistants. ASNC will continue to monitor the progress of the budget.

Senate/House Budget Offer Comparisons from July 14-15 (No additional offers were made public during the week of July 21-25.)

The House offer provides a 6% raise for teachers. The Senate offer provides an 8% raise for teachers. Both the House and Senate offers do not use lottery funds to pay for the raise and neither offer includes the removal of tenure.

The House offer does not cut any teacher assistants. The Senate offer cuts teaching assistants from third-grade classrooms. The Senate budget offer only covers second-grade teaching assistants for one year with nonrecurring funding.

The House offer does not change eligibility for Medicaid recipients who are aged, blind, disabled or medically needy. In addition, the House budget does not make changes to state/county Special Assistance. The Senate offer does make changes to state/county Special Assistance by decoupling it from Medicaid. Multiple newspapers are reporting that this change will remove at least 5,000 people, mostly living in group homes and adult care homes off of this critical support service. The Senate offer does move to the House position on protecting Medicaid eligibility to aged, blind disabled and recipients classified as medically needy.

News links for more information:

Senate Offer (News and Observer)

NC Health News

House Presentation on July 14, 2014

Senate Presentation on July 15, 2014

House Conference Committee from Monday July 14, 2014 (WRAL Video)


Medicaid Reform and Managed Care Legislation, H1181

ASNC has been monitoring the progress of House Bill 1181, which would change the state’s Medicaid program to having provider-led health plans (Accountable Care Organizations) and private managed-care plans (private MCOs), rather than the current mix of state-run, fee-for-service, and local government-managed, capitated services for mental health, developmental disabilities and addiction services (LME/MCOs). The Senate and House versions of the legislation for Medicaid reform differ significantly. The Senate’s version would move the state Medicaid program to private managed care while allowing for some ACOs or provider-led health plans, which are the main focus of the House’s plan. In addition to having Medicaid services managed by private managed care companies, the Senate would move Medicaid into a separate government agency run by a seven-member appointed board. The House’s version would keep the current structure of developmental disabilities services managed by the public LME/MCO system, while the Senate would move all services, health and disability, into an integrated private managed care model.

ASNC does not have a position on the current proposals for Medicaid reform; however, ASNC has stated previously that any change to managed care should include stakeholder involvement in planning, ensure transparency, retain/reinstate case management, and focus on good outcomes for individuals including expanded services for the wait list, rather than just cutting costs. The Coalition, composed of advocates for mental health, developmental disabilities, and addictive disease services, of which ASNC is a member, has expressed concerns about the shift away from the current LME/MCO system to private managed care. The current LME/MCO system is already capitated and under managed care, so developmental disability, mental health, and addiction services are not responsible for increases in Medicaid health-care costs.

NC Health News Report on H1181 Changes


If you have questions about public policy issues, please contact Jennifer Mahan, Director of Advocacy and Public Policy, at 919-865-5068 or jmahan@autismsociety-nc.org.



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