State Senate Passes Bill to Increase Medicaid Funding by $463 Million

Raleigh, N.C. — Days after the Senate Democrats attempted to raid the Medicaid Transformation Reserve Fund of $150 million, North Carolina Senate voted to increase funding for the state’s Medicaid program by $463 million. The expanded funding will ensure continued access to care for the state’s most vulnerable patients. The $463 million increase is an additional investment to the program’s $3.9 billion base budget.

The move to take $150 million out of the reserve would have severely impacted the ability of the state to provide care to thousands of North Carolinians. Instead of funding Medicaid transformation, Democrats have feigned interest in providing care so they could show their loyalty to Gov. Cooper’s all-or-nothing Medicaid expansion fantasy.

In a compromise, the bill extends the Medicaid transformation implementation deadline to no later than July 1, 2021. Transformation moves Medicaid from a fee-for-service system to managed care. Managed care aims to achieve better budget predictability on program costs, to allow providers to have more flexibility in how they treat their patients, and to improve patient health outcomes by focusing on integrating both physical and mental health care. The bill was amended to include an additional $50 million for operating costs for the transformation program, as requested by Secretary Cohen.

Transformation has been in the works for years, and Gov. Roy Cooper’s veto of the state budget and House Bill 555 have stalled transformation efforts to push his Medicaid expansion ultimatum. His unwillingness to compromise has forced transformation off track and put patients at risk.

Transformation will include a groundbreaking program that will screen patients to determine if they need to be connected to other programs that focus on food security, housing, transportation, employment, and interpersonal safety. This is a holistic program to treat not only a person’s health but also other social and environmental factors. Gov. Cooper is undermining his own appointed secretary by not allowing her to oversee this program.

“Since 2015 the General Assembly has committed to transforming Medicaid in North Carolina to rein in spending and improve the health of thousands of citizens. This legislation creates a necessary ‘autopilot’ funding stream for our state’s Medicaid program,” Sen. Joyce Krawiec (R-Forsyth) said. “As we work to mitigate the impact of a $5 billion budget shortfall, this bill ensures our state’s most vulnerable patients can continue to receive the care they need.”

Sen. Ralph Hise (R-Mitchell) said, “Transformation will revolutionize care in the state of North Carolina. Gov. Cooper and Senate Democrats have blocked us on almost every attempt because of his obstinate stance on expansion. This is the third attempt to get the program up and running, and the Secretary has been running afoul of state law by not moving forward.”