Medicaid transformation: Another victim of budget veto standoff

Published November 21, 2019

By Brian Balfour

An overhaul of North Carolina’s Medicaid system, approved years ago and weeks into enrollment, is being postponed indefinitelybecause funding for it was vetoed by Gov. Cooper.

Keep in mind, this is NOT Medicaid expansion, but rather a transformation of how the current Medicaid system is managed. Primarily, the overhaul would transform most Medicaid services from a fee-for-service reimbursement model to a managed care model in which the state contracts with private insurance companies to provide coverage, paid instead on a per enrollee basis. Supporters of the transformation say it would improve access to care for Medicaid enrollees while saving taxpayers hundreds of millions of dollars on the program.

Cooper not only vetoed the state budget, which contained funding for the overhaul to move forward, but also a stand alone bill which would have funded it.

Naturally, legislative leaders and Gov. Cooper’s administration point the finger of blame at each other.

In a GOP statement, Sen. Joyce Krawiec of Forsyth County called it “another crisis of Governor Cooper’s own making.”

“The General Assembly passed a clean stand-alone bill to provide the transformation funding Governor Cooper’s own DHHS secretary said she needs to do her job. His veto will force insurers to lay off thousands of people they’ve already hired as part of the years-long plan to transform Medicaid,” she continued.

The response from the Cooper administration, however, may have tipped their hand. As reported by the N&O:

“Tuesday’s announcement from DHHS said the budget and the standalone measure would have “left the department vulnerable to an unprecedented cut that would have had a crippling effect on its ability to provide services that protect people’s health and safety and moved the department out of Raleigh to Granville County. In addition, neither expanded Medicaid so that hardworking North Carolinians could afford access to health coverage.”” (emphasis added)

Such comments strongly suggest that Cooper vetoed the standalone funding bill as a means to hold the Medicaid program hostage until he gets the expansion he wants. Unfortunately, current Medicaid enrollees and taxpayers will pay a steep price for Cooper’s blockage of the overhaul.