I attended the Joint Legislative Oversight Committee on Medicaid and NC Health Choice yesterday afternoon (10/10/17). Below are notes that I took that highlight the meeting’s discussion:

Secretary Cohen – Remarks

Proposed Managed Care Program Design

  • 80-page high-level document
  • Need to build a unique NC program
  • Change is a challenge, and need to support those touched by Medicaid
  • Vision: Advance high value care; Improve health; Support providers; Build a sustainable program

Timeline: Began in May 2017 with public input, Request for Proposal released Spring 2018, contract awardees selected Fall 2018, and phase 1 will go live in July 2019

Children’s Health Insurance Program (CHIP) (covers children in families with income up to 211% of the federal poverty level or $52,000 for a family of 4)

  • Sept. 30, 2017: Congress allowed CHIP authorization to lapse
  • NC funding sufficient for now
  • Congress must reauthorize CHIP to continue servicing NC working families


(Chairing) Rep. Dollar – Currently, we are still getting federal funding, right?

Cohen– Yes, but there are no new dollars in NC. The federal money will likely run out in February.

Rep. Lambeth – You’re saying there’s been little movement on waiver. Any more insight on timeline of approval or suggestions on how we can help facilitate that?

Cohen – Likely opportunities to help, phone calls, and letters of support later down the road. Right now, there are weekly calls with staff working through technical details in proposal.

Rep. Dobson – Can you elaborate on how we can fund program with state and federal programs?

Cohen – Greater federal allocation, so we will have enough to last us a few more months due to funds still sitting there.

Dobson – What are repercussions if program isn’t reauthorized?

Cohen – Hundreds of thousands who are insured by CHIP, so they would need to be insured through individual market. Both a disruption and loss of insurance for kids.

Roger Barnes (Medicaid CFO)– 900,000 kids have S-CHIP, and should funding not be reauthorized, would be permitted to go to federal exchange and seek commercial insurance.

Rep. Dollar – Something tells me that Congress will act on this before the fail-safe date.

PRESENTATION – Medicaid Enrollment (Dave Richard, Deputy Secretary for Medicaid Assistance) 

NC TRACKS & Medicaid Fraud (as a follow-up to the meeting earlier in the morning) – In budget bill, requirement to use analytics inside NC TRACKS to identify instances of fraud and misuse. Some members heard from folks that they had slowed down the process. This was to evaluate the cost, and want to ensure the committee that we take it seriously and want to meet legislative mandate. We do need to make sure we look at our costs as we progress.

Senator Pate – To clear it up, there are 150 days in provision (which we later found out will be toward the end of November)

Richard – Enrollment is one of biggest drivers in budget process

  • Medicaid enrollment has tracked roughly in line with DMA’s expectations to date (just a little below, in fact)
  • Confident in projections that we will be well in line with forecast
  • Enrollment Dashboard on DMA Website: can see county data

Medicaid Financing

Revenues and rebates are slightly greater for SFY2018

Top four spending categories:

  1. Hospital expenditures (inpatient, outpatient, ER)
  2. Skilled Nursing Facilities
  3. Physician Expenses
  4. Pharmacy (net of rebates)

Rep. Dollar – To confirm, according to September’s numbers, you’ve seen nothing that significantly impacts the budget, correct?

Answer– yes.

Richard – Flu season- not a huge driver in terms of budget changes. High cost of drugs is more likely to ‘blow up’ the budget.

Medicaid Transformation (Secretary Cohen)

Promoting quality, value, and population health

  • Outcome measured vs. process measured (“Did you check your blood pressure?” vs. “Was your blood pressure controlled?”)
  • Focus on appropriate care
  • Alternate payment models=improved value in Medicaid system

Supporting providers (Richard)

  • Education and training through regional support centers
  • Cut down administrative burden
    • Centralized credentialing process
    • Uniform policies
    • Streamlined contract negotiations by having standardized language for select sections
  • Ensure transparent and fair payments to providers
  • Support work force initiatives (in both rural and urban areas)
  • New tools to combat Opioid Crisis
  • Support telehealth initiatives

Whole Person Care (Cohen)

  • Built on best practices from around the country and in NC’s behavioral health system
  • One insurance card that covers both behavioral and physical health needs
  • Treat the person as a whole, rather than by certain conditions (a lot of conditions overlap)
  • Timing is important (*There is no right way that we know of to do this; all states struggle with it.)
  • Standard plans
    • “Primary care” behavioral health should be included in PHP capitation rate
    • Beneficiaries benefit from integrated physical and behavioral health services
  • Tailored plans
    • Access to expanded service array
    • Specialized managed care plans targeted toward populations with significant BH and I/DD needs
    • Delayed start

Oversight of Plans (Jay Ludlam, Assistant Secretary for Medicaid Transformation, DHHS – Former Medicaid Director of Missouri)

  • We are looking for what kind of clear language do we need to put in these contracts
  • Areas of risks that vendors have that may be blind spots that we need to mitigate (or that the state might have) – and develop strategy to do so
  • Want to design a program that returns value to state
    • Definition
    • Measurement
    • Transparency

Legislative Changed Need to Run a Successful Medicaid Program

  • Behavioral health integration
  • Phased implementation plan (desire to get managed care to population as quickly as possible, but firstly get to the easier ones, like children, and then to the more challenging population. Would rather make necessary fixes along the way, rather than move backward to correct.)
  • Efficient benefit administration for family planning and inmates
  • Supplemental payments
  • Insurance regulation

Rep. Dollar – We have yet to receive background information on a range of questions, not just in behavioral health area. We do managed care in behavioral health. When you talk about moving population, you have to be very careful. GP’s writing prescriptions for behavioral health conditions becomes tricky (and a point of contention).

Cohen – critical for hospitals to continue seeing Medicaid patients. There is no one hospital that is Medicaid-heavy over the rest. Supplemental payments = not an area that allows for flexibility.

Sen. Tucker – When do you plan to have NC TRACKS up and running? 150 days…200 days…What’s the date?

Richard – We have every intention of meeting the deadline in the legislation, and I assume that we will.

Sen. Tucker – Every day that Medicaid fraud is occurring is a day that money could be saved. It seems to me that supplemental payments could lead to Medicaid expansion. Is this something you will look to moving forward with your plan? Also, what about HIE (Health Information Exchange)?

Cohen – On the ‘E’ word, I am very well aware that the NCGA is the one who decides who is eligible for Medicaid. On supplemental payments, it doesn’t change who is eligible, but only on the delivery of service and how that flows. Regarding HIE, it’s done a lot of work to lay the pipes for information to be shared. It can honestly take a number of years, and we are working with them to plan out a roadmap and to show the value to providers. We want to make sure quality factor, accuracy, and overall efficiency line up.

Rep. Dobson – On value based payments, as you know, rural hospitals in areas like mine are crucial to providing healthcare to the community. Are we confident that as we may this transition, the hospitals will be at least held harmless?

Cohen– This is the work we have been doing with the NC Hospital Association, and to make sure we tailor hospital assessments (referenced Mission Hospital).

Rep. Dobson – How are we going to balance the autonomy and flexibility LME/MCOs need in order to save money and provide services, but also with RFP, to give the state some oversight when concerns may arise.

Cohen – you hit the nail on the head. This is why we have been going through transparent process.

CCNC- 2 major functions

  • Data and analytics
  • Care management and hiring

Working on figuring out how we will fill the data and analytics function

Rep. Insko – Recommended that there be someone at the Department for beneficiaries to go to with questions.

Sen. Bishop – What parts of provider plan contract do you anticipate standardizing?

Richard – Examples are office space, hours open. Then, allow for flexibility for certain things. We don’t want to create an administrative burden for provider to where they would resist offering Medicaid. Balance with provider and health plan.

Sen. Bishop – Is there a place where public can go to see clinical outcomes?

Cohen – Not right now, but this is something I would like to see. What we have done in new contract cycle that started in July is put in new performance-based metrics. Even in data that we collect, it’s not synthesized in a way that I feel like we can wrap our arms around it. We are putting our toe in the water, and we need to be doing much better. We need to be advancing our expectations.

Sen. Krawiec – Sen. Tucker and I are like rabid dogs over a frog. This is a sore spot for us. One state she spoke with said when someone on Medicaid dies, they simply check their name off. One state noticed EBT cards were being used in Disney World. Some of these things shouldn’t be very hard. Have we looked at anything like this to go ahead and save us money today?

Richard – There are times when providers are mistaken, and we want to make that right. What we really want to find are those who are trying to use the taxpayers and are frauds. We are working to get there, and I expect that we will have a report for you on a regular basis at these meetings about our progress.

Behavioral Health Subcommittee Members

  • Senator Ralph Hise (Co-Chair)
  • Senator Valerie Foushee
  • Senator Joyce Krawiec
  • Representative Nelson Dollar (Co-Chair)
  • Representative Verla Insko
  • Representative Greg Murphy, M.D.