The Joint Legislative Oversight Committee on Health and Human Services met yesterday morning (10/10/17). The following notes highlight some of the meeting’s most important developments:

Secretary Mandy Cohen-Spoke about opioid epidemic, prescription drugs, meth, etc.

Lisa Wilkes (Legislative Drafting Division): Authorizing Legislation Committee
-22 members, 11 appointed by Senate Pro Tem, and 11 by Speaker
-Required to meet once per quarter, except when in session
-Quorum=10 members

Three handouts in packet- 4A, 4B, 4C

  1. Budget and fiscal policy highlights
  2. Conference committee report
  3. Substantive legislation relating to HHS (and budget areas pertaining to HHS)

Three subcommittees with appointees (see links below):

  1. Medical Education Residency Subcommittee (training, teaching, accessibility)
  2. Behavioral Health Subcommittee
  3. Aging Subcommittee

Child Welfare Updates: Susan Perry-Manning

  • To protect children
  • To protect parents’ rights to do what’s best for their children

NC FAST Child Welfare Update:

  • On schedule for final completion in December 2018
  • Mobility pilot project rolling out this Fall
  • Business process changes and improvements on a county basis could be huge, but will require additional funding, especially in rural counties (better technology)

Family Child Protection and Accountability Act (Riley’s Law):

  • Aggressive timeline
  • Convene a Social Services Regional Supervision & Collaborative Working Group


Rep. Dobson – You talked about training and updating the software, etc. Could you talk further about how the funds directly translate to county staff on the ground and how it’ll help them better serve their communities?

Answer– HB 630 requires recommendation from organization. Practice model allows us to centralize. Helps with the frontlines.

Sen. Barringer – How can we measure outcomes with we don’t have operative NC FAST System or dashboard? I am getting reports that in pilot program, there are problems that it isn’t working. When things are entered into the system, folks are losing their benefits.

Answer– First phase is in pilot program, which is designed to get feedback from counties. That way, as the program is rolled out, changes can be made accordingly. NC FAST requires certain amount of customization in each county. Start-up issues are anticipated. Enhancements within system should improve it. We are going to get any major defects fixed in pilot phase before rolling it out throughout the state. Eligibility will be correctly determined. We are working with tech partners to determine which issues are crucial before rolling program out vs. which can wait.

Sen. Barringer – Interested in comment about not seeing more investigations. Over 235 children as of 3 years ago that weren’t part of active investigations. All kinds of child protections should be encouraged and mandated, not just those relating to drugs/opioids.

Answer – We agree. Entire child welfare leadership team here recognizes that Dept. hasn’t met its obligations in the past, but we intend to clear all of it up now and move forward with better dedication.

Another answer (Perry-Manning) – To clarify comment previously made about investigations, any time we see a report, we will mandate an investigation.

Michael Becketts (Assistant Secretary for Human Services, DHHS) – Standards of measure-Case Review (not unable to measure, but measuring the way we were before)

Sen. Barringer– Not acceptable to be measuring the same way as years and years ago. Need to update it…upset by lack of employees dedicated to investigating child deaths.

Becketts – Need additional support in some counties about implementing NC FAST

Sen. Pate – Is it a governance issue where we need to combine some larger counties with smaller counties?

Answer (Perry-Manning) – We will need to look at best practices for delivering services and see what the best models are (perhaps around the country)

Sen. Tucker– Not about insufficient staff, but insufficient technology. The story about not enough staff is going to get old…when we meet again, you will be veterans of DHHS.

(Chairing) Rep. Lambeth– we are all passionate about this, and we look forward to the updates.


PRESENTATION (Perry-Manning): NC Pre-K Update on Slots

  • Every county that requested slots got the amount that aligned proportionally
  • 2017-18 Unmet needs that couldn’t be served

Rep. Dobson – We should be most proud of this part of the budget. What are the capacity issues across the state to manage and handle slots across the state? What is your strategic plan on how to implement that in a way that the slots are filled most effectively?

Perry-Manning – More than 20 counties that didn’t request expansion slots. We are doing a deeper dive, but they initially raised issues: inadequate supply of unlicensed teachers to open up classroom, transportation for children, and actual classrooms unavailable. Capacity is an issue. Communities struggle to match the $ amount to deliver a slot. Engaging with business partners helping department work across counties to develop analysis on finding capacity need. We are confident that next year, we will be able to deliver all slots requested, but we also want to be sure we are delivering slots across counties in a fair way.

PRESENTATION: Interim Investigation of Cardinal Innovations Healthcare (Dave Richard, Deputy Secretary for Medical Assistance, DHHS)

  • Salary of exec. was far higher than what was set in guideline
  • Severance agreements with CEO and executive staff were inconsistent from what a severance package should be
  • Cardinal is largest LME/MCO
  • Concern rests with board level (salary and severance) and CEO level (providing leadership and guidance to organization)
  • Received response from Cardinal that wasn’t as detailed as expected to specific requests
  • Following up with additional expectations, in addition to law compliances

Senator Tucker- They have never complied, what makes you think you’ll be able to pull them into compliance with existing leadership?

Richard– They did comply with some things. Secretary working directly with board will help pull them into compliance.

Sen. Tucker- I think there are things in statute that could have already been done by Secretary and Department. They are grossly out of compliance with their salary.

Richard– Cautious on response due to legal action. We do not believe they are in compliance with what OSR and NCGA have set.

Sen. Tucker– So you’re saying there won’t be lavish expenses made by board and CEO?

Richard– They’ve indicated that they won’t have board meetings outside of office, no contracts to lavish lengths to fly/travel, etc. In our follow up with Cardinal Innovations, we will expect to see all documents in our hands at that point.

Sen. Tucker– The fact that they met in Bladen County directly contradicts letter they sent. Any deadlines established for salaries to be fixed? What are we doing now within statutory authority? “How do you choke this snake that has eroded public confidence?” What can we do today?

Richard – Secretary Cohen has been clear that our standards of accountability will continue to go higher. We share your frustration at the actions and erosion of public trust in this system. We have no tolerance for an organization like this not following the law and being responsible for so many individuals. We welcome any authority that you give to us about this, but right now, we are using the current law to deal with the situation.

Secretary Cohen – We have changed all of their contracts to make sure we get the clinical results we want to get. We are using all of the tools currently in our authority right now (staff, state auditor, state HR, etc.). We will hold them to compliance but will welcome the additional work from you all.

Rep. Dollar – So we agree that specific to Cardinal, they are a unit of government as an LME/MCO. They would only continue to operate under state law?

Answer– Yes, they are constituted under state law. It is in current statute.

Rep. Dollar – So, the Department, if it chose under current law, could terminate the contract and shift responsibility to other operating LME/MCOs.

Answer– There are current things that trigger that. We obviously have tools inside the Dept. that we can use, but there are triggers that need to be met in order for us to use them. Yes, we could terminate the contract if the standards aren’t met, but we are looking to see if those standards haven’t been met.

Rep. Dollar– Have they created any additional entities within or outside of their structure?

Answer– Believe there is a non-profit in there, but that is not exclusive to Cardinal. Is it commonly done.

Sen. Barringer – Requested November board meeting date, and said she will be there if she can once they get it to her

Sen. Krawiec – In light of auditor’s response referencing six employees, has your investigative group done into a deeper dive? What if six employees were just the tip of the iceberg?

Answer– Don’t have a full picture yet, but intend to have a full picture by the end of their investigation

Sen. Barringer– Is county able to go with a different LME/MCO or is county trapped?

Answer– There are procedures. If county no longer wishes to be part of specific LME/MCO, it triggers a process that has additional rules.

Rep. Dollar – A number of issues have been raised, you are in the process of taking action, both chambers and on a bi-partisan basis are supportive of that. Is there an expectation of when you’ll be concluded with internal processes and determine action to take, and then report the action anticipated back to us?

Answer– Intention is to be on site at Cardinal between now and this month to get documents we requested. We will be at November board meeting. Ongoing process, and our expectation is that they will give us the requested information. At that time, we will have that information for you.

The meeting adjourned, but it was noted that they’d discuss more specifics on Medicaid/Medicaid Fraud at the 1pm meeting.