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State Medicaid cuts won't be easy, DHHS chief says

Posted August 4, 2011 5:40 p.m. EDT
Updated August 4, 2011 7:44 p.m. EDT

— One month into the new fiscal year, the North Carolina Department of Health and Human Services is still unsure what deep cuts will be like for Medicaid programs and services for adults.

This year's legislative mandate is to cut approximately $356 million in state Medicaid funding, and for the first time, lawmakers have added a provision to the budget that essentially directs state agencies to make any changes to their spending plans that are necessary to operate within their budget.

Health and Human Services Secretary Lanier Cansler said Thursday that the federal government requires a 60-day public notice of proposed changes to Medicaid service or programs. Then, the federal government has 90 days to approve the changes or question them. If it has questions, there is another 90-day period.

That could potentially mean that any changes to the DHHS Medicaid budget wouldn't be in place before April.

"The concern is that we're not going to be able to get the changes the legislature approved made quickly enough to achieve the savings that the legislature has put in the budget," Cansler said. "Therefore, we're going to have to make additional reductions to achieve the budget as required by the legislature."

If it's April, for example, before the cuts are federally approved, the reductions would then come from the last quarter of the fiscal year, which means a much larger reduction in patient services than if the cuts were spread over the entire fiscal year.

"It's just really going to be next to impossible to achieve this budget, and I'm not sure where the legislature will go with that," Cansler said. "The fact that this budget plays into next year (means next year) is going to be a difficult budget year as well."

That's why Cansler says he wants the process to be open. He is going outside the department to seek public input and has expanded the North Carolina Medical Care Advisory Committee to assist in the effort.

By federal law, the Medical Care Advisory Committee advises DHHS and the state's Medicaid agency, the Division of Medical Assistance, on policies regarding the quality of care and access to care for Medicaid recipients.

The committee is holding its first public forum from 9 a.m. to noon on Friday at the McKimmon Center on the North Carolina State University campus.

"I decided to use the Medical Care Advisory Committee as a public forum to have the debate and the discussion (about what to cut)," Cansler said. "There's not going to be anything easy about it, and no matter what service you modify or reduce or eliminate, you impact somebody."