- Associated Press - Tuesday, December 9, 2014

RALEIGH, N.C. (AP) - Chances for overhauling North Carolina’s Medicaid program next year dimmed Tuesday as a General Assembly committee removed what few details remained in an already vague proposal describing the path toward cost controls.

The deletions, pushed successfully by the House’s senior budget-writer with support from Gov. Pat McCrory’s administration, do not obligate the legislature to take any particular action when it convenes its new two-year session in mid-January. Lawmakers could still introduce and pass any type of legislation on Medicaid.

But the removal laid bare differences - and hard feelings - between House and Senate Republicans on the best way to avoid future shortfalls within the $13.7 billion federal-state medical program covering 1.8 million people. Last week, most members of a bipartisan subcommittee agreed to the language that got cut out Tuesday.

“The intent of the amendment was to sabotage the work the committee had done and the steps we had made toward agreement between the House and the Senate,” said Sen. Ralph Hise, R-Mitchell, co-chairman of the health oversight committee and the subcommittee. Hise told colleagues earlier there are now concerns “as to whether we just walk away from this concept altogether.”

But Dr. Aldona Wos, secretary of the Department of Health and Human Services, which runs Medicaid, warned committee members that backing a dramatic change - such as that which Senate leaders support - could undo recent fiscal accomplishments: “We must be allowed to continue on this path of success.”

While GOP leaders in both chambers and the department generally agree more of the risk of cost overruns should shift away from state government to private providers and medical entities, differences remain on exactly how to do it.

They all ultimately want to shift Medicaid away from a traditional fee-for-service model that reimburses providers for procedures performed to one that gives a flat monthly rate for each patient seen. Medical or insurance-type groups who receive the money would be rewarded for better patient outcomes and cost containment, whether through profits or keeping a portion of savings.

House Republicans, with support from Wos, want local and regional hospital and physician networks to take on patients. Senate counterparts want to allow more corporate managed-care entities to participate. While the Senate wants a relatively quick change, House prefers a phase-in.

The original report language envisioned the use of managed-care outfits, with a preference for local networks. Rep. Nelson Dollar, R-Wake, senior co-chairman of the House Appropriations Committee, offered an amendment to remove managed care from the recommendations and most other details - perplexing at least one senator.

“It seems to me we have a recipe for baking a cake but we don’t have the details for going along with it if we adopt this amendment,” said Sen. Louis Pate, R-Wayne, who backed the previous language.

But Rep. Marilyn Avila, R-Wake, likened Medicaid to a stew that was already cooking but needed new flavors to improve the taste - not thrown out for a new dish.

“Starting from scratch, with a wholesale overhaul, is probably the worst way to go about this,” Avila said.

Dollar’s amendment passed on a voice vote, but several senators didn’t appear to participate.

House and Senate Republicans may be more unified on the question of whether to expand Medicaid to cover more low-income people through President Barack Obama’s health care law. Senate leader Phil Berger and Rep. Tim Moore, the likely House speaker, are very skeptical about expansion. McCrory says he’ll talk to lawmakers about possible options.

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