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Medicaid Budget Still Unclear, Legislators Frustrated


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After months of delays, state legislators still don’t know the extent – if any – of Medicaid shortfalls for this fiscal year.

By Rose Hoban

For months, lawmakers have been asking the state Department of Health and Human Services for numbers on Medicaid budget spending, and for months, the response has been “next month.”

And Wednesday, another month’s legislative oversight meeting came and went, and still the word from DHHS on Medicaid spending targets was “later.”

“I’ve asked them every time I’ve had the opportunity, and I’m astounded that a $13 billion organization does not have budget numbers,” said Sen. Tommy Tucker (R-Waxhaw), one of the more outspoken members of the Joint Legislative Oversight Committee on Health and Human Services.

By this point in prior fiscal years, lawmakers have already been complaining about shortfalls in the Medicaid budget announced by DHHS. But this year, the budget numbers have been delayed by problems with the new Medicaid management information system, dubbed NCTracks, which rolled out last July.

The rollout has resulted in payment delays to health care providers – from doctors  to home health aides to dentists – but the biggest problem for lawmakers now is that the system has not been able to forecast where the Medicaid program is in terms of its budget. With less than two months before the short legislative session, which begins May 14, legislators say they want to know how much money they’ll have on hand to pay for teacher raises and fund other needs that have come up for the second year of the biennium.

“I do not understand how an agency that big with that many employees does not have a foreword-going forecast to be able to tell us as legislators what the backfill is going to be,” Tucker said.

Number confusion

The lack of information about Medicaid’s budget forecast came even as DHHS Chief Information Officer Joe Cooper assured lawmakers that the NCTracks system is “functioning fine.” He claimed the system is operating with fewer average defects than the industry average.

“We have defects, and as we encounter defects we address them,” Cooper told the committee during an update on NCTracks.

Cooper told lawmakers that the first priority for the system has been to reimburse providers for the services they have delivered. He also said that pending, unpaid claims are down to less than 1 percent and functions such as prior approvals for services and provider payments are performing within levels agreed to in the contract with Computer Sciences Corporation, the contractor who provided NCTracks.

And Cooper told lawmakers that the system was ready to support forecasting of the Medicaid budget for 2015, with “all the information in the data warehouse required for forecasting.”

Lawmakers then expressed confusion when Medicaid Chief Financial Officer Rod Davis told them information for developing a forecast for the rest of the year “has always been there, as far as year-to-date.”

“I think the staff and legislature as a whole have been waiting on pins and needles up until this point because we can’t get to any of the service-level information of what’s been paid out for this year and couldn’t do budget forecasts,” responded committee co-chair Sen. Ralph Hise (R-Spruce Pine). “I think your statement contradicted that.”

Davis told Hise that his department has an idea of how much they’ve paid to providers, but that they can’t forecast what’s to come.

“Would it be like saying we know what checks we wrote, we just don’t know what we’ve paid for,” Hise asked.

Davis agreed.

After more questioning from lawmakers, Davis told them that an earlier estimate of a $300 million overrun would be too high, but declined to be more specific.

“You’re confident that there’s not a $350 million, give or take, amount of money that will have to be paid out that hasn’t been processed yet?” asked Rep. Nelson Dollar (R-Cary).

“I’m relatively confident it’s not going to be that large,” Davis responded, telling lawmakers that his office would have an estimate by the next meeting of the oversight committee, in two weeks.

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2 Comments

  1. State Highlights: Wash. State Cost And Quality Bills; Okla. Privatized Medicaid; Fla. Malpractice Law Overturned | Health Insurance ExchangeMar 14, 2014 at 9:35 am

    […] North Carolina Health News: Medicaid Budget Still Unclear, Legislators Frustrated For months, lawmakers have been asking the state Department of Health and Human Services for numbers on Medicaid budget spending, and for months, the response has been “next month.” And Wednesday, another month’s legislative oversight meeting came and went, and still the word from DHHS on Medicaid spending targets was “later” (Hoban, 3/13). […]

  2. State Highlights: Wash. State Cost And Quality Bills; Okla. Privatized Medicaid | Health CareMar 14, 2014 at 7:47 pm

    […] North Carolina Health News: Medicaid Budget Still Unclear, Legislators Frustrated For months, lawmakers have been asking the state Department of Health and Human Services for numbers on Medicaid budget spending, and for months, the response has been “next month.” And Wednesday, another month’s legislative oversight meeting came and went, and still the word from DHHS on Medicaid spending targets was “later” (Hoban, 3/13).  […]

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