Berger: Medicaid primary sticking point in budget

With a new fiscal year beginning Tuesday, lawmakers remain far apart in negotiations on a state budget.

Senate President Pro Tem Phil Berger said Monday that Medicaid is the main issue holding up an agreement. Any budget deal must include better control on Medicaid spending, including a reduction in how many people are eligible for the health care assistance, he said.

"We want reductions in the welfare spending that is ongoing at the present time," Berger said.

The spending plan the Senate adopted in late May would cut thousands of elderly and disabled from the Medicaid rolls and would push for a managed care-type system to control future costs.

The House and Gov. Pat McCrory favor a plan that puts physicians and other health care providers in charge of cost control and doesn't change eligibility requirements.

Senators don't believe the forecasts McCrory's staff have assembled on Medicaid costs in the coming year, however, believing that the state needs to set aside $200 million to $300 million more than state Budget Director Art Pope says is needed.

"Those numbers are not accurate," Berger said of the Medicaid projections.

McCrory and House leaders announced a deal last week on a slimmed-down budget that would provide raises for teachers and state workers and let the rest of state government operate on the two-year budget lawmakers passed last year.

No senators were involved in those discussions. The Senate budget would provide larger raises for teachers but would pay for them by cutting more than 7,000 teaching assistants statewide and would make the raises contingent on teachers giving up their tenure rights.

Berger was coy when asked why neither he nor other Senate leaders were invited to take part in those negotiations, but he said he wouldn't have backed the plan McCrory and the House crafted.

"I could not support what they did after I've had a chance to look at it," he said. "The position of the Senate is a very reasonable position. We're hopeful that we'll be able to work out the differences that we have."

Without a deal, McCrory has instructed all state agencies to operate at reduced spending levels.

Berger said he isn't optimistic about a quick resolution.

"Even under the best of circumstances, we're looking at being here through most of July," he said.