It is yet to be known if Gov. Perdue will veto the budget compromise or pocket it for 10 days so that it passes without her signature. Not counting funds for the state highway patrol, the compromise spends $19.5 billion, with $4.5 billion in the Department of Health and Human Services (DHHS). The starting point for the year was $20.8 billion, with $4.9 billion in DHHS.
The biggest reductions are in Medicaid ($356 million), mental health ($58 million, mostly one-time), central management ($20 million), and social services ($16 million).
To "level the playing field" with state-owned hospitals and to take advantage of Medicaid’s perverse payment system, the budget saves $68 million in the first year through new assessments on providers. It also brings in an additional $1.2 billion in Federal dollars. Legislators expect $90 million in additional savings from the Community Care of North Carolina (CCNC) managed care plan and another $10 million from mental health waivers. It seeks savings of $119 million through lower provider rates and elimination of inflationary increases for providers. Another $16.5 million in savings comes from service changes. If the state had the option to reform Medicaid and reduce enrollment, it could provide better services to those most in need, but ObamaCare prohibits reasonable changes, so everyone on Medicaid faces reduced services and doctors face lower payments. We’ve addressed ways to reform Medicaid and so did Brian Blase and Dr. Clare Gray.
