Raleigh, N.C. — Health providers and Democrats lined up behind a proposal by House Republican leaders to change how the state's Medicaid health insurance system pays doctors, hospitals and others who provide care to poor and disabled residents.
The House Appropriations Committee passed the measure on a unanimous voice vote Wednesday morning. The full House approved the bill 113-0 later in the day. It now heads to the Senate.
House Bill 1181 does nothing to bridge the differences between the House and Senate over Medicaid spending that have thrown a wrench into this year's budget negotiations. Rather, the House plan would spark a five-year effort to control health care spending, which has accelerated in fits and starts over the past decade.
"It is important that we make the commitment, we chart a direction, we move forward and we stay committed to that direction for the long-term," said Rep. Nelson Dollar, R-Wake, the reform plan's lead author.
State taxpayers are expected to put roughly $4 billion into Medicaid next year, along with another $10 billion in federal spending. The system pays for the care of roughly 1.7 million North Carolinians at any one point in time, meaning it both accounts for a huge slice of the state budget as well as the health care of nearly 20 percent of the state's population.
Earlier this year, senators called for a much more abrupt change in the Medicaid program. Their budget would have called for a quick shift to a managed care system in which health insurance providers assume much of the control over patient care. That system has the virtue of making costs to the state much more predictable and at least on paper reduces North Carolina's budget commitment to the program much more quickly.
Senators also called for the creation of a new agency to oversee Medicaid, rather than leaving the system in the hands of the Department of Health and Human Services.
That Senate plan is at odds with a vision rolled out by Gov. Pat McCrory after a year's worth of public hearings and study. McCrory says the move away from DHHS is wasteful. Instead of an insurance-company-led system, he called for the creation of accountable care organizations, groups led by doctors that are paid to deliver healthier patients, rather than reimbursed procedure-by-procedure.
The House plan picks up the governor's idea and embellishes it. DHHS Secretary Aldona Wos endorsed the House effort at a meeting last month. Dollar said "it provides the framework" for accountable care organizations and similar groups to develop, much as McCrory had envisioned.
Wednesday morning, representatives of some of the most influential health care lobbies in the state backed the House plan as well.
Cody Hand, a lobbyist with the North Carolina Hospital Association, called it "a good step in the right direction." Medicare, the federal health insurance system for the elderly, is already experimenting with accountable care organizations. The House bill, he said, would allow hospitals to use one set of systems to track patients in both of the big government-run health programs.
Between the time the bill was first rolled out in June and Wednesday's meeting, lawmakers excised a portion that would have allowed local mental health agencies to manage the physical health care of patients with mental health issues or developmental disabilities. That portion had been controversial among several communities.
"We think this bill as it is written now addresses our concerns," said Chip Baggett, a lobbyist for the North Carolina Medical Society, which represents many of the state's doctors.
May Hooper, director of the North Carolina Council of Community Programs, which represents local mental health agencies, said her members also backed the measure.
House Democrats, who are sometimes at odds with their Republican colleagues over issues related to entitlement spending, gave their blessing to the bill during Wednesday's meeting.
"This sounds like a pretty decent bill," said Rep. Mickey Michaux, D-Durham, a long-serving lawmakers and former budget writer.
Michaux later made the procedural motion to send the bill forward with the committee's support.
It is unclear what will happen to the bill once it clears the House. Senators have said that earlier versions of the measure move too slowly on reform. It is also possible the long-term reform efforts could get caught up in the current wrangling over the budget.