A key lawmaker in the North Carolina House wants to give health officials the go-ahead to dip into reserve money to prevent major cuts to the state’s Medicaid program — but the timeline and process for that proposal remain unclear.
Rep. Donny Lambeth (R-Forsyth), who chairs the House’s budget and health committees, introduced a plan Tuesday evening that would allow the NC Department of Health and Human Services to use up to $190 million in the state’s Medicaid Contingency Reserve to cover shortfalls in the state’s low-income health insurance program.
The department began cutting rates for all providers earlier this month, ranging from 3% to 10%. Leaders in the House and Senate have been unable to reach an agreement to provide more funding.
Lambeth said the plan to tap into reserves would allow the state to freeze those rates until an agreement is reached. It would likely cover any shortfall through “to the end of June,” he said.
“This is a clean way to resolve the problem,” Lambeth said.
But even if the House chooses to approve the bill during their session Wednesday, it’s not clear when — or if — the Senate would do so. Senate Leader Phil Berger (R-Rockingham) said the chamber would not hold any more voting sessions this week. The next session date isn’t until mid-November.
A spokesperson for Berger did not immediately respond to a request for comment about the proposal.
It’s also immediately unclear whether the state would have the authority to tap into reserve funds without approval from lawmakers. The money has technically already been allocated to the department, Lambeth said, but it has “not been allocated for this purpose.”
“That’s really where the rub is,” Lambeth said.
Republicans have been critical of Gov. Josh Stein’s administration’s decision to cut rates, arguing they are unnecessary. But Stein and the state health secretary, Dev Sangvai, have said they cannot avoid making budget cuts without further funding from legislators. DHHS has said the money state lawmakers have appropriated to the Medicaid program so far falls $319 million short of what’s needed.
“Just like any household budget, we must make decisions based on the resources we know are available, not those we hope to receive,” Sangvai said in a statement ahead of cuts last month. “And under North Carolina law, the state is required to maintain a balanced budget, meaning we cannot spend money knowing we will run out well before the end of the fiscal year.”
DHHS did not immediately respond to a request for comment on the bill.
The House returns to session Wednesday morning to vote on a new Republican-led congressional map. They could also take up Lambeth’s bill, which was approved by the House Rules committee Tuesday evening.
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