- Associated Press - Thursday, March 27, 2014

RALEIGH, N.C. (AP) - North Carolina’s health secretary defended her agency’s work since she took the job last year, responding Thursday to criticism from top Republican legislators who questioned whether the department could operate effectively and pull off any Medicaid overhaul.

Dr. Aldona Wos, facing pointed questions from a second legislative committee in as many days, said the Department of Health and Human Services has made great strides since she arrived during a time of “crisis management.” But she said agency leaders have been waylaid by job vacancies and employee turnover caused in part by below-market salaries.

“We must secure our workforce with proper compensation, with proper skill sets, so that we can move forward,” Wos told the Legislative Commission on Governmental Operations, the General Assembly’s chief oversight committee when not in session.

She said hiring a permanent Medicaid director has been difficult and suggested vacancies could lead to DHHS hiring more expensive contract workers.

Previous Medicaid director Carol Steckel left in the early fall, and the department has been faced with a series of prolonged problems, including complaints by doctors about getting paid through a Medicaid billing system that went online in July.

Legislative budget-writers have yet to benefit from data collected by the system that’s supposed to help with Medicaid forecasting. The legislative and executive branches have agreed there is a shortfall in Medicaid for the year ending June 30 that’s smaller than last year’s deficit, but still don’t have much confidence about how much it is.

“When will we get the numbers that we need to have a good budget number?” said Sen. Bob Rucho, R-Mecklenburg. Wos shot back that there had been an unprecedented level of collaboration and that they’re getting more information “every single day.”

Wos, who was appointed by GOP Gov. Pat McCrory and works for $1 annually, said later that the seemingly constant reports and documents to legislators could make it hard to hire people: “We are micromanaged.”

A separate computer system designed to streamline eligibility for government services has been marked by backlogs and a pending threat by federal regulators to withhold funds unless food stamp applications are processed. Senate Majority Leader Harry Brown, R-Onslow, also pointed out how the agency mistakenly sent Medicaid enrollment cards with the personal information of nearly 49,000 to the wrong addresses at the end of December.

“Now we see a lot of people leaving has really put your department in a really tough position,” Brown told Wos, but “how can we as a General Assembly feel safe or comfortable that you can implement a reform package when we have all of these problems?”

Wos unveiled last week a proposal requested by legislators on how to make state Medicaid spending - expected to total at least $3.5 billion this year - more predictable and how to avoid repeated shortfalls. The proposal’s key element is the creation of networks of primary care physicians or hospitals that would have financial incentives to keep Medicaid costs below set levels but would also share in cost overruns.

Wos, a Greensboro doctor and wealthy GOP donor, said her office had been working on Medicaid reform essentially since she arrived and consultants had aligned the plan with the needs of the department. The General Assembly would have to approve any plan.

Senate leader Phil Berger, R-Rockingham, said after the meeting the hard questions didn’t necessarily mean his colleagues had lost confidence in Wos‘ leadership. “We just want to make sure that we have the capacity to engineer that sort of change, or any sort of change,” he said. “So I think it’s fair to ask questions about some of the other things that the department has been engaged in.”

Rep. Nelson Dollar, R-Wake, was one of the few voices supporting Wos on Thursday, praising improvements within DHHS while affirming issues still must be resolved.

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