A week after taking control of the governor’s mansion and the state legislature, Republicans on the Oversight Committee on Health and Human Services get back to business.

By Rose Hoban

Even as many top state officials prepare to rotate out of their jobs, they gave state lawmakers an update on where North Carolina health-care programs are headed at last week’s Oversight Committee on Health and Human Services meeting, providing updates on the Medicaid budget, changes to the mental-health system and licensure for lay midwives.

But first lawmakers grilled Secretary of Health and Human Services Al Delia about money Gov. Bev Perdue ordered his department to spend on the state’s pre-kindergarten program, formerly known as More at Four.

NC Secretary of Health and Human Services Al Delia Photo by Rose Hoban
NC Secretary of Health and Human Services Al Delia. Photo by Rose Hoban.

In response to a court ruling requiring the state to enroll additional children in the Pre-K program, Perdue took $20 million out of the DHHS to provide funds for an additional 6,300 children to enter the program.

Delia told lawmakers that money came from programs such as the AIDS Drug Assistance Program, foster-care services, funding reversions and unspent salaries.

“I would ask how you can make a determination that you have this additional $20 million to commit … given that at the end of the fiscal year just a few months ago we passed a bill that provided additional funds because the department needed cash flow to finish out the fiscal year,” said committee co-chair Rep. Nelson Dollar (R-Cary).

“It sounds like, to me, you’re spending anticipated reversions when the department has cash-flow issues.”

“Obviously, you’re not going to be there. But are you guaranteeing to the General Assembly you’re not going to be coming back to us because of cash-flow issues at the end of the fiscal year?” Dollar asked, referring to Delia’s impending departure given the new administration of Governor-elect Pat McCrory.

Delia responded that he didn’t think there would be the same kind of cash-flow problems this year.

“Kids are 4 years old only once, so if we miss the opportunity to serve these kids, we miss it for the rest of their lives,” Delia added. “We’d lose a whole class of kids if we didn’t do it now.”

He also reminded the panel that the governor was responding to a court order.

“I hope the secretary’s optimistic view of where we are with the budget holds true with the end of the year and the fiscal year,” Dollar said.

Medicaid funding

Some of lawmakers’ favorite projects are awaiting funding, pending the status of the state Medicaid budget come January.

At the end of the last fiscal year, the General Assembly needed to appropriate an additional $212 million to Medicaid to cover a budget shortfall that had grown over the previous year.

According to state health officials, much of the shortfall was the result of an increase in patients with expensive needs entering the Medicaid program and technical adjustments made by the federal government, as well as an overly optimistic timetable for savings asked for by the General Assembly.

But in an effort to impose fiscal discipline on the Department of Health and Human Services, the budget held back almost $21 million from a handful of programs. That money will be released on Jan. 1 only if the multibillion-dollar program is meeting its budget targets at that time.

According to Steve Owen, chief business operations officer for the Division of Medical Assistance, financial monitors at the program have been tracking Medicaid’s balance sheet on a weekly basis rather than the former monthly tracking schedule.

Owen reported what he said would be a temporary shortfall of $33.5 million by the end of October, including a $26-million cash shortfall that he said was caused by timing issues with payments and receipts.

“That $26 million is going to come down substantially,” Owen said. “We should make that up through the course of this year.”

Owen also blamed some of the changes from his previous projections on variations in enrollment. Almost 8,300 fewer people are enrolled this year than last. But he said many of the people who are enrolled in Medicaid are people who are more expensive to care for.

“This year, we’re seeing less children enrolled and we’re seeing much higher disabled,” Owen said. On average, children cost the least, while people with disabilities cost the most.

“We have several items in the budget that are conditional funding based on the status of this on Jan. 1 and certification by the [state budget office],” Sen. Ralph Hise (R-Spruce Pine) reminded Owen. “Is there any indication that things will be worked out by then?”

Owen said he believed that some of the variances would be worked out, but he also said that the projections were for the entire fiscal year (which runs from July – June), so he could not say where the budget would be by the end of the calendar year.

Programs with funding contingent on the status of Medicaid in the new year include more than $12 million for extra psychiatric beds in community hospitals and at Broughton Hospital in Morganton and nearly $5 million in prevention funds to go to county health departments.

Licensure for lay midwives

Several hundred pregnant women in North Carolina gave birth at home last year using the services of certified professional midwives.

But the number is only an estimate, because any births attended by a certified professional midwive (CPM) were done illegally.

CPMs aren’t currently recognized in North Carolina, but are legally recognized in 27 states and licensed in 25. So advocates for CPMs came to the oversight committee to ask members to endorse their efforts to have CPMs practice legally in the state.

“North Carolina has evolved into the most hostile state in the nation” against families wishing to have babies at home, Russ Fawcett, vice president of N.C. Friends of Midwives told the committee. He said he believed that was the case in the wake of the criminal prosecution of one lay midwife and issuance of several cease-and-desist orders against other CPMs.

And this past summer, a handful of nurse midwives  were forced out of practice when their supervising doctors withdrew their support. (see box for the difference between nurse midwives and professional midwives)

There’s only one way to cultivate a safe and supportive environment for home births, Fawcett said: Enable access by certified professional midwives and create a framework for success.

Fawcett pointed to data showing a recent increase in the number of home births in the U.S., and pointed out that many women who choose to have a home birth have low-risk pregnancies.

He also told lawmakers that the state of Washington has estimated its midwife licensing program saved the state Medicaid program about $1.5 million a year.

“Why will getting a license improve training, if they’re qualified already,” asked Rep. Marilyn Avila (R-Raleigh).

Fawcett told her that licensure would give the state the ability to monitor what is happening with home births. Currently, he said, data on the practice is scant because women either have their babies without an attendant or don’t report that a CPM was there.

David Barnes, a lobbyist for the N.C. Obstetrical and Gynecological Society, told the panel that licensing certified professional midwives will give people “a false sense of security.”

“People will think CPMs are nurses and know how to handle emergencies,” Barnes said, delineating the difference between CPMs and certified nurse midwives.

“CPMs are not nurses. You are not required to have any formal medical training,” he said.

Barnes’ organization did not support the nurse midwives who lost their ability to practice this past summer when their supervising physicians withdrew their supervision.

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Rose Hoban is the founder and editor of NC Health News, as well as being the state government reporter. Hoban has been a registered nurse since 1992, but transitioned to journalism after earning degrees...