Friday, May 21, 2010

NCGA: Senate Budget Passes-Moves to House

Yesterday the North Carolina Senate held its final vote on their proposed budget. The Senate budget includes the following items:

Expansion of the 1915 b/c Managed Care Waiver:

$1,560,600 million expected savings by expanding the capitated behavior health pilot program to two additional local management entities effective January 1, 2010. Effort is based on the Piedmont Behavioral Health pilot.

Restoration of Funding:

$40 million in funding for community service funds administered through Local Management Entities. $23 million will come out of the state general fund and an additional $17 million will come from TANF funds. This is a full restoration of the $40 million cut in the 2009-2010 budget.

Expansion Funding:

Local In-Patient Bed Capacity

$12 million in increased funds available for three-way contracts to purchase local hospital bed capacity for crisis response within the community. These fund will support the purchase of an estimated 50 beds. It will bring the current funding to $32 million. (This is a recurring line item expansion)

NC Health Choice Enrollment

$6,500,000 will provide the state the ability to increase enrollment in Health Choice by 2% or 2,750 children. This will bring the total number of children served by the program to 137,789. (This is a recurring line item expansion)

Medicaid Rebase

$430,564,713 this increase to the Medicaid Budget for FY 2010-2011 will account for 5.6% growth in eligibles above the current levels.

Adult Care Home Fund

$5,000,000 increases funding for adult care homes based on acuity levels for the personal care services provided in adult care homes. Funding will assist in the development of a 1915 c Medicaid Assisted Living waiver for individuals that reside in adult care homes that meet skilled nursing level of care and currently receive State County Special Assistance.

Training In Facilities

$534,795 increases funds available for training of direct care state and front line leaders in patient care.


Medical Assistance Co-Payments
$4,530,404 increases current copayment amounts to a maximum of $3.40, and expands collection of co payments to local health departments and outpatient behavioral health services. This reduction also implements a $6.80 copayment for nonemergency hospital emergency room visits.

Where problems may happen with this budget?

Both the Governor and the Senate are using $482,111,583 in American Recovery and Reinvestment Act Federal Enhanced Matching Funds to be able to balance the budget. The concern expressed by many has been that the federal government has yet to pass the extension on the FMAP match dollars. If the budget wraps up before the federal government passes their legislation the members of both chambers will need to either look at cuts or a special session depending on the time line.

Cuts that were in Governor’s Budget but not in Senate Budget?

The following cuts were included in the Governor’s budget but were not included in the Senate budget.

·  Dental:

$11.6 million reduction that would limit adult dental coverage to emergency care only.This recommendation limits adult dental coverage to emergency care only. With this policy change, covered services will include emergency exams; diagnostic x-rays; urgent care extractions; biopsies; excision of tumors; repair of soft tissue wounds; treatment of fractures; and a portion of adjunctive services, such as general anesthesia and IV sedation, hospital calls, and therapeutic drug administration.

·  Occupational Therapy, Speech Therapy, Physical Therapy, Respiratory Therapy:

$4.3 million reduction under Improving Utilization Management for Optional Services.  This cut would reduce the maximum number of visits for adult speech therapy, physical therapy, occupational therapy, and respiratory therapy to three visits per year.



Where do we go from here?

Right after the Senate passed their budget work began in the House. The House Health and Human Services appropriation subcommittee met late yesterday to review the budget and flag several items.


The House HHS Appropriation committee also received their target numbers during this meeting. Target numbers are the budget amount that each subcommittee has to work with. These numbers were slightly higher than the Senate numbers. The Senate HHS budget came in at $3,915,632,709. The House will be working with the target number of $3,916,087,568 or a difference of $454,859.

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