Bill Summary for S 408 (2021)

Summary date: 

Jun 28 2022

Bill Information:

View NCGA Bill Details2021
Senate Bill 408 (Public) Filed Tuesday, March 30, 2021
AN ACT TO DIRECT OVERSIGHT, STUDY, AND MODERNIZATION OF MEDICAID IN NORTH CAROLINA, TO ENSURE TAXPAYER SAVINGS, AND TO ENSURE ACCESS TO HEALTHCARE FOR WORKING NORTH CAROLINIANS.
Intro. by Burgin, Krawiec, Perry.

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Bill summary

House committee substitute deletes the content of the 2nd edition with the following.

Section 1.1

Creates the six-member Joint Legislative Committee on Medicaid Rate Modernization and Savings (Committee). Provides for appointment of members and chairs. Charges the Committee with two purposes, including (1) assessing whether the Department of Health and Human Services (DHHS), Division of Health Benefits (DHB) is completing three tasks related to Medicaid enrollment, beneficiary services, and management of beneficiaries by prepaid health plans (PHPs) and local management entities/managed care organizations (LME/MCOs), and (2) considering and making legislative recommendations regarding the plan to modernize Medicaid put forth by DHHS as mandated by the act, presented by the DHHS Secretary on December 15, 2022, at which time the Committee must vote on its recommendation and terminate. Details Committee meetings, voting, expenses and staffing. Authorizes the Committee to file a copy of the proposed legislation and a copy of DHHS's plan with the President Pro Tempore and the Speaker of the House. 

Section 1.2

Directs DHHS to develop a Medicaid Modernization Plan (plan), submit the plan to the Committee by December 15, 2022, and make a presentation on the plan at the Committee's December 15, 2022, meeting. Lists eight components the plan must contain, including (1) the adjustment to Medicaid eligibility to allow individuals described in section 1902(a)(10(A)(i)(VIII) of the Social Security Act to qualify for coverage with a start date proposed by the DHHS Secretary, excluding individuals who are not US citizens unless required by federal law; (2) proposed legislation to discontinue Medicaid coverage for these individuals if the federal share of the cost of providing coverage becomes less than 90% or the nonfederal share of the cost cannot be fully funded from four sources specified; (3) proposed legislation to enact increased hospital assessments through the Hospital Access and Stabilization Program (HASP), as mandated by the act; (4) proposed necessary refinements to the health system assessment enacted; (5) an investment of $1 billion to address the opioid, substance abuse, and mental health crisis in the State, as specified; (6) projections of savings in the existing Medicaid program from implementation of the plan; (7) specific proposals to increase access to preventative care for Medicaid enrollees; and (8) specific proposals to increase access to healthcare in rural areas of the State. Section 1902(a)(10)(A)(i)(VIII) of the Social Security Act includes individuals who, beginning January 1, 2014, are under 65 years of age, not pregnant, not entitled to, or enrolled for, benefits under part A of title XVIII, or enrolled for benefits under part B of title XVIII, and are not described in a another subclause, and whose income does not exceed 133% of the poverty line applicable to a family of the size involved. 

Requires the NCGA to take action on or after December 16, 2022, and prior to the sine die adjournment of the 2021 NCGA, to enact legislation to implement the plan, in whole or in part. Limits legislation to the plan and HASP proposal. Prohibits implementing the plan without express legislation authorization taken on or after December 16, 2022.

Section 1.3

Establishes the ARPA Temporary Savings Fund as a nonreverting special fund in the Division of Health Benefits (DHB) consisting of any savings realized as a result of federal receipts arising from the enhanced federal medical assistance percentage (FMAP) available to the State under section 9814 of the American Rescue Plan Act (ARPA). Requires legislative allocation or expenditure of the funds. States legislative intent that at least $1 billion of these funds be expended on addressing mental health and substance abuse issues in the State.

Section 1.5

Effective January 1, 2023, through March 31, 2023, subjects private acute care hospitals and public acute care hospitals to a 0.052% hospital health advancement assessment of its hospital costs for the fiscal quarter beginning January 1, 2023. Raises the hospital health assessment rate to 0.516% for the State fiscal quarter beginning April 1, 2023, through June 30, 2023, effective on the date of the adjustments to Medicaid eligibility described by the act; provides that no assessment can be imposed for the State fiscal quarter beginning April 1, 2023, and no county department of social services (dss) reimbursements made if the effective date occurs after June 30, 2023. For both assessment periods, requires DHHS to use $2 million of the assessment proceeds and all corresponding matching federal funds to reimburse dss for additional costs incurred to implement the adjustments to Medicaid eligibility described in the act.

Section 1.6

Revises the defined terms under Article 7B, GS Chapter 108A, the Hospital Assessment Act. Adds and defines Consumer Price Index, expansion nonfederal share, and newly eligible individual. Adds a new Part to the Article, statutorily providing for the public hospital health system assessment, and the private hospital health system assessment. Requires quarterly calculation and collection for each assessment. Provides for the calculation of the hospital health system assessment to be the aggregate health system assessment collection amount, multiplied by the public hospital historical assessment share or the private hospital historical assessment share, as appropriate, divided by the total hospital costs for all public acute care hospitals or private acute care hospitals holding a license on the first day of the assessment quarter, as appropriate. Formulates the health system collection amount to be the sum of the cost components, including the service cost component and administration component, minus the gross premiums tax offset component and the intergovernmental transfer offset component, as those components are formulated in the Part's provisions. Requires DHHS to reimburse a county dss with proceeds attributable to the county for costs incurred in determining eligibility for newly eligible individuals, as provided in the administration subcomponent, as well as any corresponding matching federal funds. For the quarter beginning July 1, 2023, sets the public hospital health system assessment at 0.223%, and the private hospital health system assessment at 0.445%. For the quarter beginning October 1, 2023, requires DHHS to determinate the percentages by adding or subtracting the reconciliation component, calculated as described by the act, divided by the total hospital costs of either all public acute care hospitals or private acute care hospitals holding a license on the first day of the assessment quarter, as appropriate. Effective July 1, 2023.

Section 1.7

Amends GS 108A-145.3 to exclude capitation payments not attributable to newly eligible individuals from the definition of paid capitation applicable to the Hospital Assessment Act. Amends GS 108A-146.9 to exclude claims attributable to newly eligible individuals from the fee-for-service component of the aggregate modern hospital assessment collection amount calculated under GS 108A-146.5.

Amends GS 108A-146.12 to set the postpartum coverage component of the modern hospital assessment amount at $4.5 million for each quarter of the 2023-24 fiscal year. Amends GS 108A-146.13 to set the postpartum subcomponent of the intergovernmental transfer adjustment component of the modern hospital assessment amount at $1,065,000 for the 2023-24 fiscal year. Repeals Section 9D.13A(e) and Section 9D.14, SL 2021-180. Effective July 1, 2023.

Amends Section 2.1, SL 2021-61, amending the definition of federal medical assistance percentage (FMAP) applicable to the Hospital Assessment Act, Article 7B, GS Chapter 108A, to include the applicable temporary increase of Medicaid FMAP allowed under section 9814 of ARPA. 

Section 1.8

States legislative intent to consult with stakeholders and DHB prior to the 2023 Regular Session to consider any necessary refinements to the health system assessment enacted in Section 1.6.

Section 1.10

States legislative intent to assess hospitals for the nonfederal share of a directed payment program to be called the Healthcare Access Stabilization Program (HASP), to fund hospital payments described. Directs DHHS to consult with stakeholders to develop a submission of a 42 CFR 438.6(c) preprint to the Centers for Medicare and Medicaid Services (CMS) to request approval for the payments which are to be the maximum permitted that can be funded entirely through increased hospital assessment receipts that are in addition to the receipts from the health system assessments enacted. 

Directs DHHS to submit the request within 60 days of the date the section becomes law, whereby DHHS must submit the preprint to the specified NCGA committee and division. Requires DHHS to continue working to obtain CMS approval if CMS denies the initial submission. Requires DHHS to submit a copy of the approved preprint to the Committee and specified NCGA committee and division. 

Deems the hospital reimbursement increase approved effective upon the enactment of the legislative language necessary to fund the portion of the nonfederal share of the reimbursement increase that will not be funded through intergovernmental transfers, through increased hospital assessments. States legislative intent to consult with stakeholders and DHB prior to the Committee's December 15 meeting to develop such language, including any necessary changes to the modernized hospital assessments under Part 2, Article 7B, GS Chapter 108A, and the health system assessments enacted.

States legislative intent, upon approval of the preprint, to enact increases to the hospital assessments under Article 7B, GS Chapter 108A, that meet detailed criteria, including that the increased assessments at minimum apply to all private acute care hospitals, and the proceeds of the increased assessments and federal funds are limited to specified uses and restrictions. 

Section 2.1

Directs the Secretary of Commerce to develop a plan to create a seamless, statewide, comprehensive workforce development program (statewide plan) in collaboration with 13 listed stakeholders, and any others the Secretary deems appropriate. Authorizes contracting with third-party entities in the development and implementation of the statewide plan. Requires coordination of efforts and resources across State agencies for statewide availability of workforce development opportunities. Enumerates five required components of the statewide plan, including identification of currently existing workforce development programs for unemployed or low-wage workers and any gas for improvement of the program, identification of the specific labor force needs within the state, and inclusion of six identified services offered in the plan. 

Section 2.2

Requires the DHHS to collaborate with the Department of Commerce (Department) to develop a method to assist individuals enrolled in the Medicaid program and other relevant social service programs with accessing appropriate workforce development services; develop a referral plan for assessing the current employment status and any barriers to employment; and determine the best method to provide social service beneficiaries an initial assessment and consultation with a workforce development case manager. Allows contracting with third-party entities or PHPs to provide these services, and authorizes the use of incentives to PHPs with regard to the services. 

Section 2.3

Requires the Secretary of Commerce to report to the specified NCGA committees regarding the statewide plan by March 1, 2023. States required components of the report. 

Requires DHHS to report to the specified NCGA committees regarding the referral plan and employment barriers for social service beneficiaries by March 1, 2023. State required content of the report. 

Requires DHHS to collaborate with the Department to quadrennially report to the NCGA, beginning December 1, 2023, to the specified NCGA committees and division five data points described regarding social service beneficiaries, workforce development program participation, and employment/reemployment. 

Section 2.4

Directs DHB to enter into negotiations with CMS to develop a plan and obtain CMS approval to condition Medicaid participation upon work requirements, if any indication exists that such conditional requirements may be authorized by CMS. Requires notification of the specified NCGA committee and division within 30 days of entering such negotiations. Requires submission of a report to the specified NCGA committee and division within 30 days of CMS approval of such a plan.

Amends the act's titles.

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