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NC Senate blocks federal health overhaul offerings

Published on NewsOK Modified: February 4, 2013 at 10:09 pm •  Published: February 4, 2013

RALEIGH, N.C. (AP) — The Republican-controlled state Senate gave initial approval Monday night to a bill that would keep the state government from carrying out elements of President Barack Obama's federal health care overhaul despite the reservations of new Gov. Pat McCrory.

The party-line 31-17 vote in favor of the legislation occurred when Republican Senate leaders decided to move ahead with the bill despite receiving a letter hours earlier from McCrory's legislative lobbyist urging more time to consider how the current bill could harm the state financially.

"We believe additional time is necessary to evaluate the serious financial ramifications of (the bill) to North Carolina taxpayers," said former Rep. Fred Steen, officially the governor's legislative liaison.

But legislative leaders say the content of the bill — to block expansion of Medicaid under the health care overhaul and leave it to the federal government to build the state's online marketplace for health insurance — was important enough to move ahead. The second of two required votes was expected before the bill heads to the House. McCrory would be asked to sign any bill into law.

Under the Medicaid expansion, the federal government will repay states all costs related to the expansion for three years and 90 percent thereafter. But opponents say Washington could back out of that promise, leaving states to shoulder the burden alone.

"We cannot afford it," said Sen. Ralph Hise, R-Mitchell, adding he's worried the generous matching rate will disappear "and we will continue to saddle the citizens of this state with a large burden that we didn't ask for."

The state government is still struggling to control its own Medicaid costs, which has been running up shortfalls the past three years and had become a "cancer" to the rest of the state budget, said Sen. Pete Brunstetter, R-Forsyth, one of the chamber's chief budget-writers.

Passing the legislation in its current form would delay or possibly eliminate funding for a federally mandated computer system to determine eligibility for programs like Medicaid, Steen wrote. The General Assembly previously agreed to pay for the program with federal grants that will be necessary even under a federal-run exchange.

Sen. Tom Apodaca, R-Henderson, a chief sponsor of the bill and the Senate Rules Committee chairman, said he read the letter and "didn't see anything in it to be concerned over." Apodaca said his attorneys told him the state can still obtain all if not most of the funding for the North Carolina Families Accessing Services through Technology program if the bill were to become law.

According to Steen, McCrory agrees with lawmakers that North Carolina is not in a "position to expand a broken Medicaid system at this time, which is why his current focus is to aggressively pursue reforms."

McCrory also understands "that there are too many unanswered questions remaining about the cost, process and technology necessary to pursue a partnership or state-based exchange in 2014," Steen wrote.

The 2010 health overhaul law requires the establishment of health exchanges — online marketplaces where people can shop for health insurance, much of which would be government-subsidized. If a state doesn't set up an exchange, the federal government will run an exchange for that state.

The North Carolina Institute of Medicine wrote in a study released last Friday that by agreeing to the expansion North Carolina would provide coverage to 500,000 residents — most of whom would remain uninsured without the expansion. Health advocates also argue the expansion would create new jobs and actually save the state money over time.

Several Democrats urged Republicans to delay passage of the bill and lamented how blocking the Medicaid expansion would harm rural hospitals that already treat the uninsured through charity care and the patients themselves. Other states with Republican leaders are agreeing to the expansion, they said.

"That is our taxpayer money, whether it goes to the federal government or the state," said Senate Minority Whip Josh Stein, D-Wake. "What you all are saying is we're going to have North Carolina taxpayer money paid to the federal government go to insure people in Arizona, in Nevada" and elsewhere.

In November, former Gov. Beverly Perdue set North Carolina on course for an exchange run jointly by the state and federal governments. The Democratic governor said she consulted with McCrory before acting, but the former Charlotte mayor expressed reservations.


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