08/08/14 — Legislators share their thoughts on budget, Medicaid

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Legislators share their thoughts on budget, Medicaid

By Steve Herring
Published in News on August 8, 2014 1:46 PM

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Hal Tanner III, publisher of the Goldsboro News-Argus, delivers a question at the Wayne County Chamber of Commerce Legislative Update Breakfast for, from left, Rep. John Bell IV, Sen. Louis Pate and Sen. Don Davis.

Medicaid is a broken system in North Carolina -- broken so badly that state legislators won't have time during what remains of their short session to effectively tackle it, state Sen. Louis Pate said Thursday.

While Medicaid reform was the chief topic of discussion, Pate, Sen. Don Davis and Rep. John Bell also focused on education and the budget as they provided a recap of the ongoing session at a legislative update breakfast at Lane Tree Conference Center.

Rep. Larry Bell, D-Sampson, and Rep. Jimmy Dixon, R-Duplin, were unable to attend the event sponsored by the News-Argus and Wayne County Chamber of Commerce.

Pate and John Bell are both Republicans. Davis is a Democrat.

Most of the Medicaid discussion was led by Pate, who is considered one of the senior legislators at the forefront of the issue. And the Medicaid discussion appeared to generate the most reaction from the audience of over 100 people.

"The past four years we have had to make up almost $2 billion for our Medicaid budgets because they have been subject to massive overruns," Pate said. "It is not the fault of Medicaid patients. It is the fault of the Medicaid structure that I believe is causing all of this.

"We have got to cure it. That is what led to the House and the Senate looking at it. I must say we came up with two different plans. That is why we are going back into session in November to hammer out what we are really going to do with Medicaid in North Carolina."

The Senate plan contends that Medicaid is not getting the attention it deserves because the state Department of Health and Human Services with its some 18,000 employees is so large, he said.

Under that proposal, Medicaid would be moved into its own department, but "lodged directly underneath the governor."

"We would institute a board structure that would run Medicaid policy and hire a world-class person to be the director of Medicaid," Pate said.

The Senate proposal would include "whole person health" looking at mental as well as physical health, he said.

The House has taken a different approach, he said.

"They want to modify Medicaid and leave it within the department and have a provider-led payment system which more or less operates like Medicaid does at the moment," Pate said. "It would pay more attention to the cost being incurred, but a provider would still be running the system.

"We in the Senate do not think that is going to save the amount of money that is necessary to avoid these cost overruns."

From a "human being standpoint" Medicaid patients deserve the medical care they need and legislators are not going to harm that, he said.

However, the first place that a Medicaid patient is apt to go is the emergency room which drives up cost, Pate said.

"If we can prevent a person from going there through preventive type medicine or by having a primary care doctor to look after that patient prior to a person getting into such a condition that they have to go to the emergency room, we think it will save a lot of money," he said. "It would also be worth paying their bill at a primary care provider's office to avoid going to the emergency room."

Davis agreed with Pate and praised his leadership on the issue. But he expressed disappointment that business could not be concluded without extending the session.

Lawmakers have been given responsibility for a $21 billion budget, yet a fundamental problem is that there are millions of dollars involved in Medicaid that the state does not know about having to pay from year to year, he said.

"You can't run a business and you definitely can't run a state this way," Davis said.

Davis said he did support a decision to put a reserve fund in place to help with the overruns.

"But we must have predictability first and foremost," he said. "It shouldn't be so much the guessing game that is.

"I am leery of making arbitrary cuts just to say we are trying to bring rates in line, and we don't know 100 percent of the time if we are comparing apples to apples and oranges to oranges when we look at these rate cuts and make comparisons to other states."

On the issue of teacher pay, Davis disagreed with Pate and Bell as to how much more teachers would actually earn as a result of a pay increase approved by the Legislature. The budget puts more money in the hands of teachers, but Davis questioned whether the state had truly acknowledged the period of time they went without an increase.

Davis also disagreed with Pate and Bell that the Common Core curriculum was an attempt by the federal government to take over education in the state. The standards that were done away with during the session were created by collaboration among the states, not the federal government, he said.

They all expressed disappointment that extra pay for teachers earning their master's degree would end.

"We knew going into the session, in fact we knew four years ago, that public education was suffering in North Carolina," Pate said. "But everything was in an uproar when we got there in 2010."

The state had to find $2 billion for Medicaid so it was almost impossible for the state to think about what it would like to do, he said.

With tax reform and an improving unemployment rate, the state "felt safe" that it could address education and teacher pay, Pate said.

The idea was to give increases to the beginning teachers who are leaving the field because of low pay, Pate said.

The state had to stop that flow first, he said. That is why the budget is loaded at the "bottom end," he said.

Pate said he believes lawmakers will address how the state can help veteran teachers next year.

"This is not perfect what we have done, but it is all that we could afford to do," he said.