A controversial bipartisan Medicaid expansion bill was fast-tracked Tuesday to the House floor in a potential ploy to win Democratic support for overriding a veto of the state budget compromise.

If passed, House Bill 655, submitted by Rep. Donny Lambeth, R-Forsyth, on April 9, could set up a clash with the Senate on the hotly debated Medicaid issue.

House GOP leadership opted at the end of Tuesday's five-hour session to postpone a vote on HB665 and the veto override.

The next session is set for 2 p.m. Wednesday. 

Medicaid expansion could cover an additional 450,000 to 650,000 North Carolinians.

"We want everybody to have time to think about where they are on this (state budget) vote," House speaker Tim Moore said after Monday night's session, when the first opportunity at a veto was withdrawn. "We're going to wait until the time is right."

The Medicaid expansion bill and the state budget compromise have become quickly intertwined since HB655 stunningly resurfaced Monday via a notice that it would be heard Tuesday morning by the House Health committee.

When HB655 cleared what proved to be its only committee hearing by a 25-6 vote, an amendment established that it would only go into effect with the passage of House Bill 966, the state budget bill.

Moore told The Insider legislative media outlet Monday that "it seems like a good time (to address HB655), and a lot of folks have been asking for it to be heard."

Rep. Darren Jackson, D-Wake, told The Insider that "I imagine that is an attempt to shift blame for Medicaid not being expanded from the House to the Senate."

The Medicaid expansion bill has at least six Democratic amendments teed up for a floor vote. One calls for removal of the state budget passage link.

Another would strip out a work requirement for some recipients between ages 19 and 64, which is key to House Republican support.

Mitch Kokai, senior policy analyst with Libertarian think tank John Locke Foundation, said the timing of placing HB655 on the House floor "suggests that a vote on this bill is tied pretty closely to the work to secure votes for the veto override."

"If the House speaker believes he needs a vote on this measure in order to prevail in the veto battle, he’ll move as quickly as he can to resolve both issues.”

Senate opposed to HB655

Senate leader Phil Berger, R-Rockingham, and his GOP Senate lieutenants remain unrelenting in their opposition to any form of Medicaid expansion.

Analysts say it's possible, if not likely, that the Senate would decline to address HB655 if it clears the House.

Before Lambeth introduced HB655, Berger criticized the pending legislation in March, including calling an administrative expansion cost agreed to by hospitals and healthcare providers a tax that would eventually be paid by patients.

Since Democratic Gov. Roy Cooper vetoed the state budget compromise, Berger has claimed that Cooper is "holding the entire budget hostage" over Medicaid expansion that he says puts "able-bodied individuals" in front of disabled individuals for funding priorities.

Medicaid expansion impact

Governor Roy Cooper’s office presented Tuesday the potential county-level socioeconomic impact of expanding the state Medicaid program to between 450,000 and 650,000 residents.

County New individuals covered New jobs Economic impact New revenue
Alamance 5,242 917 $445.4 million $3.5 million
Alleghany 513 133 $22.8 million $154,000
Ashe 1,152 98 $36.4 million $340,000
Davidson 4,996 656 $213.2 million $2.4 million
Davie 1,105 91 $37.6 million $741,000
Forsyth 12,809 2,058 $1.2 billion $7.8 million
Guilford 17,693 3,160 $1.99 billion $11.6 million
Randolph 5,447 596 $271.4 million $2.6 million
Rockingham 2,939 313 $126.9 million $1.06 million
Stokes 1,200 92 $31.7 million $849,000
Surry 2,854 286 $137.7 million $1.5 million
Watauga 2,211 325 $144.6 million $982,000
Wilkes 2,814 173 $79.4 million $761,000
Yadkin 1,276 64 $30.3 million $431,000

Cooper released Tuesday morning an updated version of his budget priorities, led by Medicaid expansion.

“Compromise shouldn’t be a dirty word, and we need to work together to provide for North Carolina’s most pressing needs,” Cooper said.

“This budget gives us an opportunity to secure health insurance for half a million people and strengthen public education while still balancing the budget, cutting taxes for people and saving responsibly.”

Cooper cited in an accompanying press conference that Medicaid expansion has been approved in 36 states.

"Most of the people we're talking about, the vast majority of people are already working, but those are items that can be discussed as we continue to negotiate this budget," Cooper said.

"Clearly, if they're discussing (HB655), they realize that it's an important part of this process, but it has to go through two chambers in order to pass, and I'll leave it at that."

Lambeth bill resurfaces

HB655 had lain dormant since being introduced by Lambeth as a second attempt at a bipartisan plan to potentially add or expand Medicaid coverage.

The bill, titled “NC Health Care for Working Families,” represents significant elements of the Carolina Cares legislation that Lambeth introduced with no success in 2017.

The goal is having the legislation in effect by July 2020. Lambeth said it would take at least a year for federal Centers for Medicare and Medicaid Services to approve a required waiver if the bill were to become law.

The overwhelming committee support for a bill that Lambeth described as "first steps" and a "start" appears to confirm claims from supporters and detractors that the legislation — even as described as flawed — has enough bipartisan support to clear the House.

"This is the most talked about bill in this session and a hotly contested issue in this state and country," Lambeth said as he began an impassioned presentation of the bill. "This (bill) has a chance to be a (Medicaid) alternative that might work and fit North Carolina's culture."

Lambeth referenced a work requirement for participants and that participants would be required to contribute up to 2% of their household income toward an annual premium, billed monthly. There are some exceptions to the requirement.

“There will be at least 300,000 individuals who will be covered by expansion, and another 200,000 who would find this as a viable, lower-cost health insurance option compared to what they are currently eligible for,” Lambeth said.

Another proposed amendment on the House floor would have required the N.C. Department of Health and Human Services to make public the number of Medicaid participants through expansion and other socioeconomic data.

Opposition arguments addressed

Lambeth addressed many of the Senate GOP leadership's arguments against HB655 during his committee presentation, such as the hospital and healthcare provider assessment that would contribute 10% of the new administrative costs while the federal government would pay the remaining 90%.

Healthcare systems and prepaid health plans would pay $758 million annually.

"Read my lips. There is no state funding" required, Lambeth said.

Berger has questioned the federal government's ability to commit to the 90% match.

“Governor Cooper is pushing this idea that his Medicaid expansion proposal is revenue-neutral to the state, but that idea is just not based in reality,” Berger said. “There is no such thing as free money; someone always has to pay.

“In this case, it’s the taxpayers in the private insurance market who at the end of the day will pay the price of this new tax to fund expansion.”

Lambeth said the 90% federal government match is sustainable and would take an act of Congress to change.

Cooper's office has said “hospitals and other healthcare providers are for Medicaid expansion because it increases their bottom line and helps get more patients insured.”

Mark Hall, law and public-health professor at Wake Forest University, released a study in April 2018 titled “Do States Regret Expanding Medicaid?”

Hall said requiring hospitals to help pay for North Carolina’s 10% of new administrative costs “is not likely to increase costs to patients because hospitals will also see reduced uncompensated care.

"The two effects — tax and reduced uncompensated care — should be a wash.”

One Medicaid reality

In April, a federal judge blocked Kentucky from implementing a similar Medicaid work requirement and keeping Arkansas from continuing its program.

According to media reports, more than 18,000 Arkansas enrollees have lost Medicaid coverage since the state began the mandate in summer 2018.

Some opponents said that while they appreciate the intent of HB655, they oppose the work requirement, saying it could lead to more than 88,000 current Medicaid recipients losing their coverage.

“Gov. Cooper’s budget plan recommends expanding Medicaid to bring $4 billion into North Carolina’s economy, create an estimated 40,000 jobs and provide more affordable health care for 500,000 people,” according to a statement from Cooper’s office.

Lambeth said he was not certain how many jobs would be created through HB655, but he said, "there will be jobs created."

Lambeth said at the rate of enrolling 300,000 North Carolinians through HB655, it would bring $4.7 billion in additional federal funding into North Carolina.

By contrast, Lambeth said he understands North Carolina is missing out on at least $1.7 billion in federal funding by not expanding Medicaid since taxpayers are paying taxes that contribute to expansion in other states.

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