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Senate | June 17, 2014 | Committee Room | Appropriations Health and Human Services Part 2

Full MP3 Audio File

Please take your seats and we will resume round two of the Senate Health and Human Services appropriations sub-committee. This afternoon we're going to be going through the changes to the provisions between the house and the senate. And we'll follow the same procedures we did this morning. We'll go through the entire document and then we will take questions from the members. Miss Joyce Jones, I believe you're the first one to present this afternoon. You can come forward. Thank you. [SPEAKER CHANGES] Good afternoon Mr. Chair and members of the committee. I'm Joyce Jones from Legislative Drafting, and I am going to be walking you through the document that you should have in front of you. It is the special provisions, just the items that are in controversy or that are different as between the house and senate. This package does not include identical provisions. I am going to begin in the division of central management. I am actually going to start on what is numbered as page 271 in your package. There is one special provision that precedes this one, but within the division of central management. But, my colleague Lisa Wilkes will cover that when she comes up to cover up her assigned areas. So, right now, if you could turn with me to page 271. The first provision that differs between senate and the house, funds for statewide for health wide health information exchange. If you recall, this special provision requires a division of central management to allocate sufficient funds to the non-profit entity known as North Carolina Health Information Exchange. This was to represent the state share for the maximum amount of approved federal matching funds. Or allowable medicate administrative costs related to the HIE network. These provisions are the same except that if you look on page 72, you'll see that I have starred subsections C. The house version added language to require NCHIE to provide a detailed audited report to HHS oversight by March 1 of 15. And the report is to give an explanation of use of state appropriations received pursuant to this section, as well as its receipt in expenditures of federal matching funds for cost related for the HIE network. So, the next page we have a senate only provision. On Page 273. This provision in the senate extended by two years the deadline for the Department of Health and Human Services to implement system modifications to the replacement MMIS, also known as NCTracks. In order to allow contract entities like the LME NCOs, to perform medicate claim adjudication within the NCTrack system. The house did not include this special provision in their package. Instead, you'll see on page 274, the house repealed last year's budget provision that required the department to implement those system modifications. Turning to page 275, this is the house only provision that follows money. It is technical in the sense that it just revises the amount of prior year earned revenue that may be used for replacement MMIS during the 14-15 fiscal year for consistency with the money report. We have a similar house only provision on page 276. Again, this is technical in nature as it confirms with the money report. Just revises the amount of the prior year earned revenue that can be used for NC fast in the 14-15 fiscal year. You turn to page 277, this is the house only provision that follows money. Susan Jacobs explained this a little bit earlier this morning. This is the supplemental short term assistance for group homes. You may recall that we had an identical provision in the budget last year. And, basically it provides two million dollars of non-recurring funds to the secretary's office for the 14-15 fiscal year to provide funds for one additional year of assistance to group home residents who are determined and eligible for Medicaid PCS. Honored after January 2013, due to some Medicaid state plan changes in PCS eligibility. I'll just note for you on page 278 that this section does expire on June 30th, 2015. We're gonna flip over now to the division of aging in adult services. So if you would, please turn with me in your

Speaker: Package to page 296.Page 296 this is a provision on state county special assistance both the senate and the house had provisions addressing essay as we call it,however the senate version did substantially more.The senate version follows the money and you'll see the changes that are significant that are highlighted with stars.The senate version eligibility for essays that are hundred percent ?? November 1st 2014, and you'll see that around like 18 to 24.The next change in senate version starts in the line 28 and this change narrows situation under which the version treatment on ?? facility.This is the change in line 8 and line 28.Eliminates the provision allowing non residence to qualify for spending ?? days in North Carolina resident as a close resident relative.The next significant change in down in line 37 , 36 and 37 and this is the change that narrows situation under which a person receiving treatment under state facility with mental contact can qualify for ?? and that only the compact requires the state to continue up personally ??.When you turn the page you see that the house version to need it all of the state version and eligibility that makes a clear technical change ?? law and there is no change to eligibility in the house version.On the page 298 and also page 300 these are different versions of same senate provision.The only difference if that the senate and the house are marked on page 300 and page 301, I' ll just note that and the house distinction is that it retains ?? by allowing for a report a summary of this information and also by directing guardian to explain the document diligence but unsuccessful attempt ?? this information on page 301 you'll also see that start language that allows the ?? to file ?? or by one ?? of confident witness.Page 302 is the only house special provision ?? and adult services and developments of a strategic state plan ?? they have 16 different issues related to this disease.Page 303 is also house only provision it requires the division of aging and adult services to reinstate the voluntary development program as service category under the ??.This also allows the counties to use this programs to provide services to elder adults from these ?? Page 304 is the C D S A provision there are difference between the senates and the house you'll note that on page 304, I have start the significant parts of the provision.The senate version requires the department to close for state operators of C D S A by January 1 2015 and also to make eligibility requirement to change this program for the 14,15 ??.The house distinction if you turn to the over the next page on page 305 to start the language to show difference the house versions directs the departments to slow off options in order ti achieve the reductions that set out in the budget.Page 306 is the senate only provision it follows money.This is the ?? funding initiative we have directing those funds ?? to counties only and again this only appeared in senate provision.Page 307 and 308 this is the increasing fee over well water testing.These two are identical over ?? on 308 i start the news exception that appears in the house version that adds provision on the report of public health on the ?? review commission option for reducing or waving this fee.

Households with incomes at or below 300% of the Federal poverty level. Page 309 is a Senate only special provision that follows money. This transfers the On-Site Water Protection Branch currently in DPH to the Division of Water Resources within deener. Page 313 is a Senate only provision, it requires program evaluation to consider including in its 14-15 work plan a study on ways to improve North Carolina's medical examiner system, with particular focus on death investigation policies and procedures. Page 314 is a House only special provision dealing with operational efficiencies for the office of the Chief Medical Examiner. This provision changes the current method of appointment for medical examiners. It also requires the Division of Public Health to study and report to HHS Oversight on the adequacy of current fees paid by state, the state and counties for death investigation and autopsies. And subsection C also directs that a portion of the appropriations for this office be used to establish an oversight system to achieve operational efficiencies and improve quality assurance of death investigations. It also requires the department develop and implement a uniform protocols for conducting death investigations in accordance with established best practices. Page 315 is a House only special provision, it extends by one month the date that the department must submit its diabetes coordination report, and this is just to make it consistent with the due date for another similar report on chronic care coordination. Page 316 is a House only special provision effective July 1, it allows the state to retain the $400,000 that is currently appropriated for aid to counties for local food and lodging programs. The state is required to use these funds to operate the state elements of the food and lodging program, and that would mostly be to cover costs related to food and lodging regulation. Page 317 is a House only provision that follows money as well. It transfers the summer food service program, and all the federal funds received for this program, to the Department of Public Instruction effective July 1, 2014. Page 318, these are special provisions related to the Division of Mental Health, Developmental Disabilities, and Substance Abuse Services. The first is traumatic brain injury funding. This provision follows money, and if you turn to page 319, I've underlined the only difference between these two provisions. The House version added language allowing for contracts with other appropriate providers, and not just to Brain Injury Association of North Carolina and Carolinas Rehab. Page 320 is a Senate only provision, the closure of the Wright School. The House opted not to include this. Page 321 and page 323, again the same provision with some modifications in the House. If you turn page 23, I have underlined and starred some of the important differences between these two provisions. Notably in lines 24 through 30 on page 323, there's just an addition of a reference to the Medicaid state plan definition of facility based crisis programs for children and adolescents, and it also makes other technical corrections that are noted. On page 324, if you look at pages, sorry, lines 18 through 20, this language just requires that the strategy developed by the department include recommendations as to any regulatory changes necessary to ensure safety and quality, and facility based crisis programs for children and adolescents. Page 325 is a House only special provision, it requires the department to report to HHS Oversight on budget shortfalls resulting from liabilities associated with community services for the Division of Mental Health and state operated health care facilities under the jurisdiction of the department. Page 326 is a House only special provision that follows money. This requires the Division of Mental Health to use $5.2 million of funds appropriated for Fiscal Year 14-15 to increase the number of behavioral health urgent care centers that provide outpatient crisis services and facility based crisis services at the same location, and it also specifies other uses of those funds. Page

Anon begins the division of health service regulation. Page 327 is a Senate only provision, this makes modifications to the health care cost reduction transparency act that was passed last year. It redefines the term health insurer to include a risk of self insured and group insured health plans. It clarifies that each of the five largest health insurers must report information about the most frequently reported admissions by DRG. It requires the medical care commission to adopt rules specifying the method by which the department is to determine the most common DRG's, imaging procedures, and surgical procedures for these reporting requirements, rather than requiring the commission to establish the most common ones by rule each year. It also exempts these rules from certain provisions of the administrative procedures act. Page 329, this is the moratorium on home care agency licenses for in home aide services. There are differences as between the Senate and the House. I've noted them for you at the bottom of those pages. The Senate version makes this moratorium permanent until the General Assembly knocks legislation to lift it and the House version extends the moratorium by two years until July 1, 2016. Page 331 and 332, this is the moratorium on special care unit licenses. The Senate version makes the moratorium permanent until he General Assembly enacts legislation to lift it and the House version sunsets this moratorium one year early on July 1, 2015 instead of July 1, 2016. Page 333, this is a House only special provision. Effective October 1, 2014 it increases the minimum age for use of tanning equipment from 13 to 18 and it repeals the exception for youth below the minimum age requirement who present written prescription from a medical physician. There are some general health and human services special provisions that I'll cover and they begin on page 385 of your package. Page 385. You'll recall that last year there was legislation passed requiring hospitals to connect in with the health information exchange network and this special provisions makes some modifications to that statute. It makes a technical correction but it also requires the NCHIE to provide professional staff of the fiscal research, bill drafting, research, and program evaluation divisions with access to information in that network. The differences between the Senate and the House version are that the house version is much more specific as to how staff will be able to access that information and it also requires the NCHIE to provide this information to staff in a way that is consistent with the standards specified for de-identification of health information under HIPPA standards. On page 387, this is a Senate only provision, that establish the joint legislative study commission on traumatic brain injury. The house opted not to include that provision. Page 389 is a Senate only study, it requires program evaluation to consider, including in it's 1415 work plan a study of the benefits and disadvantages of requiring local ABC boards to stop paying the department from revenues generated by local ABC mixed beverages surcharge and the local guest room cabinet surcharge for alcohol or substance abuse treatment, research for education and it instead redirects these payments to the North Carolina ABC commission for it's substance abuse education and prevention initiative. Page 390 is the House only special provision and it reinstates the ability of UNC medical schools and UNC satellite medical offices and the UNC health care system to utilize hospitals set off debt collection. Mister Chair that concludes my remarks and now Lisa Wilkes will come up and explain her provisions. [SPEAKER CHANGE] Thank you Miss Jones, Miss Wilkes. [SPEAKER CHANGE] Thank you Mister Chair, members of the committee, Lisa Wilkes with legislative drafting. If you'll turn with me.

In your booklet to page 267 as Miss Jones mentioned, there’s one provision in central management that I’d like to discuss. On page 267, this is your competitive grants provision and this provision follows the money. Just to mention, on page 268, if you’ll recall in the Senate provision under subsection 8 you made a direct appropriation for the 2014-15 fiscal year to big brothers big sisters of the triangle with the intent that going forward they participate in the competitive grants process so that’s that stark difference that you see on page 268 and then if you’ll turn with me to page 269, you see also on page 270 – the House did not elect to give that direct allocation to big brothers big sisters nor put them directly into the competitive grants process. What they did do is on page 270 line 5, you’ll see a new sub-subdivision and they created a new initiative for comprehensive smoking prevention and cessation program for pregnant women and postpartum mothers. Now, if you’ll turn with me to the division of child development and early education that begins on page 279. This is your childcare subsidy rates, revised co-payments and eligibility criteria provision and this provision follows the money. The biggest differences between the House and Senate versions, if you look under 12(b).3 subsections A and B, you’ll notice date differences. The House moved it to October 1, 2014 and that basically is to align with the market rates provision which we’ll talk about a little bit later. Also, if you look on page 280, there’s a new subsection, A1 and this is language that’s House-only that the House added regarding allowing for a transition period. Regarding the eligibility changes, the Senate elected to make those changes effective immediately, of course beginning on the September 1 date. What the House decided to do was to create a transition period. So, if you’ll look under section A1 it allows for child who’s currently on the income eligibility based on 75% of the state median income, to remain there until their next re-determination and on that date, they will then become a part of the new eligibility income criteria under subsection A of this section. So that’s the change on page 280. Moving on to page 281, this is the smart start tentative maintenance of effort requirement and if you look on page 282, the difference here – the House added a new subsection A and this basically requires NCPC to hire three staff to assist local partnerships with fund raising and grant writing. The remainder of the provision is identical. Moving on to page 283, this is study childcare subsidy for 11 and 12 year olds and if you look on page 284, the difference here is that last line is underlined on 9/11. What the House did was to make it clear that the findings and recommendations are to be separate for each age group. Moving on to page 285, provides childcare allocation formula. If you look at the bottom of subsection B on page 285, this was Senate-only language and what the senate did was require that any reallocated funding in fiscal year 2013-14 become part of a County’s allocation in future fiscal years and beginning with fiscal year 2014-15, the revised formula would apply to both increased and decreased allocations. So that was the language in the Senate version. If we move on to page 286, you’ll see.

That subsection B here was the language from last year’s version of the child care allocation formula. The House did not elect to take the language that’s in the Senate version for subsection B. What it did was create language under subsection C. So if you’re looking beginning on line 28, the biggest difference begins with the subdivision 1 and what subdivision 1 says, it provides that beginning the 2014 15 fiscal year, the department is to use 1/3 implementation of the new census data allocation formula every 2 years. However for the 2014 15 allocations, a county that did not have a subsidy waiting list in the 2013 14 fiscal year does not receive an increase in its allocation based on the new allocation formula. And beginning 2015 2016, a county whose spending coefficient is below 95% in the previous fiscal year does not receive an increase in its allocation in the following fiscal year, meaning 2016 2017. However it does provide for a waiver due to extraordinary circumstances. And it also further provides for a report by the department due on October 1 of each year on the number of counties that were granted the waiver pursuant to that subdivision, sub-subdivision. It goes on to say that under subdivision 2, immediately upon release of new census data, the department shall use 1/3 biannual implementation reflecting a 6 year phase in approach to each census cycle thereafter. So basically the difference in the Senate version is a 2 year phase in, the House version is a 6 year phase in. Moving on to page 288, this is a House only provision. Child care market rate adjustments. And what this does is adjust market rates for 3 to 5 star rated child care centers and homes to 40% of the difference between current market rates and the 2013 market rates. Moving on to page 289, NC pre-K audits. Again this is a House only provision. And it addresses an issue regarding duplicate audits, by requiring local partnerships administering NC pre-K programs to be subject to audits that are already under current law. Page 290. Again, this is a House only provision. Child care license certification by DHHS. This allows the division to assume responsibility for issuing certifications for child care early educators. All right, moving on to the division of social services. On page 291, this provision follows the money and there’s only a slight modification on page 292, line 30, you notice that under subdivision 4 it references any funding needs. And if you’ll turn with me to page 295, line 23, under subdivision 4 the House changed that to reflect adequacy of funding. All right, and now if you’ll turn with me to the very end of the book on page 404, this is your block grants provision. Again this is page 404, toward the back. And I’m going to go ahead and just have you turn to the House version again this follows the money. And the House spent, had some additional funds to spend in ten of contingency funds. If you look at page 405, lines 36 to 39, this shows you where that additional money, those additional funds show up. Plus 12 million. And then if you’ll turn with me over to page 409, there are two differences that I’ll point out here. One with the mental health services block grant. Under item 2, the Senate has, this amount, they mainly had the funds

00:00 funding under that particular item however if you look at items 4 for the most far all the way to item 10 the house elected to break out these various initiatives versus putting them under a particular item I also note that the senate version also listed as a specific initiative item 5 which is the critical time intervention similarly under this substance abuse prevention and treatment block grant on page 410 if you turn with me to that page item 05A which is the substance abuse services treatment for children and adults the senate had a slightly increased amount for that item and they also had an item funding for the veterans crisis which is item 05F however the house as you can see here again elected to list out specific initiatives in terms of giving the funding under the substance abuse block grant the last thing I'll note is on page 410 at the bottom the house carved out under the maternal and child health care block grant funding for prevent blindness and Mr Chair that concludes my remarks Mr Ryan Blackledge will be up next. [SPEAKER CHANGES] Thank you miss Welch Mr Blackledge. [SPEAKER CHANGES] Mr Chair, members of the committee Ryan Blackledge with Legislative Drafting I'm going to cover medicate provisions they start on page 334 page 334 I'm gonna cover the first half and then Jennifer Hillman is gonna come up and cover the second half of this the very first provision the senate had a medicate reorganization that they set out they created a new medicate nst outside of the department of health and human services and also specified that there will be full risk capitated health plans for medicate, if you turn to page 336 you will see that the house did not do that nor did they include any details about a direction for reform and said that there was just this provision that follows the money and says that anything for medicate reform can only be used for medicate reform and not anything else like a shortfall I will note though if you turn to page 383 the house did have a provision that had some restructuring so to speak and the house had included a provision that required again it's page 383 the house had required a provision to have the medicate director recommended by the secretary of health and human services appointed by the governor and then confirmed by the general assembly sets up a 5 year term of office they can be removed for some reasons they're not completely serving at will there're some reasons they can be removed and then there's some additional detail in here the general message being just appointment and approval by the general assembly of the medicate director alright let's jump back to where we were let's go to 337 please page 337 Steve mention this already this morning the senate had made some adjustments to medicate eligibility there was delinking the SA and then also the elimination of coverage for the medically needed the house chose not to do either of those additionally within this senate provision on page 337 there's that subsection B which had a study to look at some possibilities for taking some additional coverage down for aged,blind and disabled persons on page 338 there's a provision that the senate had and the house did not that was just a study of an additional 1915C waver over on page 339 and also 340 there's the senate version and the house version of a traumatic brain injury waver just to draw your attention to the 340 the house version of that you can see the underline language the house just added a few additional details on the study on page 341 there's a provision that follows the money this was discussed earlier this involves [??] a something on the nursing home direct care services case mix right now that goes up periodically and this would have put a freeze upon that that automatic rate increasing on page 342 there is well 342 and 333 are two different ways of dealing with something the [??] government is going to be requiring of states or at least theoretically it's expected and that's changing to using the average acquisition cost for drugs. 05:00

00:00 Just as reminder everyone when drugs are priced there's the cost of the ingredients and there's also the dispensing, looks like the federal government is gonna require states to go down on the cost of the ingredients and what the senate did was to say alright increase the dispensing fees so that net there's a savings of 975 thousand dollars what the house said was make it budget neutral so as those ingredient costs go down raise the dispensing up so that the pharmacists are more or less kept whole, also the house version is conditional on the federal government actually requiring this whereas the senate version says January 1 2015 just go ahead with it. On page 344 there is a provision that was amended on the floor during debate on Thursday from the house and this is something that has two conditions on it one if there are savings in doing what I'm about to describe and then second the department may choose to do it there's an issue when we've got on the drug list preferred drugs which are brand drugs that the state actually net works better than the generics because there are certain rebates and so the prices are better on that than the generics and so there's a requirement that those drugs be dispensed sometimes though pharmacists can't get a hold of those preferred brands and so what this provision would do is if there are savings that the department may allow pharmacists to instead substitute the generic if they can't get the preferred there're some details on what the pharmacists would have to do they'd have to keep records they'd have to try within the two prior weeks but this is just something that would allow pharmacists to substitute some generic drugs in certain circumstances page 345 something that follows the money is in senate only that's mental health drug prior authorization Steve already mentioned this one this morning, page 346 both the senate and the house had something on studying personal care services or PCS but on page 346 you can see there're two subsections that were senate only Steve mentioned these this morning these were the sections that required the department to go back and recoup and then also make rate adjustments to further reduce the amount of cost for personal care services, one thing to know on page 348 there were couple things added to the study portion by the house just looking at the impact on any reform of personal care services any impact on appeals and legation and also there on lines 25 and 26 included within the study just the quality of resident care within adult care homes. Alright if you look at page 349 and also 350 if you kind of hold them open you can see two very very different approaches senator Mckissick this is actually what you asked about earlier this morning with the base rates the senate created a state wide base rate and what the house did was pull back from last year's budget where there was a director to the department to do the regional base rates the house pulled back from that and turned that into a study and so you can see a modification on page 350 modification on what was on last year's budget changing to that study page 351, 352 another couple that you probably wanna keep open at the same time so you can see this [??] with the supplemental payments that go to UNC and the ECU providers if you look on line 11 over on page 351 and line 8 you can see that the number of slots allowed for east Carolina university went from 375 to 418 that should really be considered a technical fix because we got updated information indicated that 418 was actually the number that had been receiving it so that should be really considered technical what's not technical on page 352 is line 14 the house included language say that supplemental payments shall not be made for services provided in wake county additionally if you look further down both of those pages you'll see different percentages over in the senate you see 28.85 over in the house you see 25.9 that's just linked to different approaches to the hospital provider assessment tax these supplemental payments are funded by the university. 05:00

What happens is, for each $3 that they’re going to draw down for this, they put in a dollar. What the change is made here is instead of putting in a dollar in the Senate version they have to put in basically $1.28. In the House version they have to put in $1.25. The $1.25 corresponds to a provision that was Senate only and I’ll explain that one in a little bit more detail and you’ll see how that’s linked when we get to it. Page 353 and 354, again another one where it’s helpful to keep them open and look at both. The subsections A and B are identical, however there were different modifications made to the list. This is the shared savings program. Both chambers repealed it, but there’s a 3% rate reduction. The Senate gave that 3% reduction back to optical services and supplies, podiatry, chiropractors, hearing aids. The House gave it back, if you look over on page 364, gave it back to nursing homes. So again, the subsections A and B are identical and it’s the C where those differences are. Turn to page 355, there was a Senate provision to publish Medicaid payments to providers, similar to what was published for Medicare payments was done recently. The House did not do that. On page 356, there was a study of a physician assessment. The House did not do that. On page 357, there was an increase to the hospital assessment retention by the state. You’ll , a few pages ago I was talking about that 25.9% and then the 28.85, that’s where these percentages come from. So the other provision would have treated UNC and Eastview the same as the other hospitals in terms of the percentage. And because this was a Senate only provision, the House did not increase the assessment on hospitals. They used the existing 25.5% for the universities. Page 358 was something that the Senate had included because the Governor had included it in his budget. We got additional information after the Senate budget passed that CMS will not approve this. This is something that we cannot do. There’s something else on page 359 which we also currently cannot do. This is what the House proposed. But this is an assessment on 1915C innovations waiver services. Federal government does not allow this, but this is a 3 year authorization that if federal law is changed or if CMS allows waivers to do this within the next 3 years, then this is something that the department may pursue. There’s already an assessment on IFCMR services and these are services that are in the alternative to those. And so this is something that was included there, another potential source of income. Again, the federal government authorized it, but they may. Over on page 360, the Senate’s repealed the planned CCNC payment of PNPMs. Last year’s budget had the department and CCNC work together to transfer all of the PNPM money to be paid out, and then have CCNC have in a tiered system make those payments to the doctors. The Senate repeals that. If you turn to page 361, the House directs it to occur. So, the complete opposite. That 12H.19 is the last one I’m going to do. At this point Jennifer Hillman is going to come up and do the rest of the Medicaid provisions. [SPEAKER CHANGES] Thank you, Mr. Bocklage. Miss Hillman? [SPEAKER CHANGES] Thank you, Mr. Chair, members of the committee. Picking up on page 362, we have a Senate provision that has a very different House counterpart. The Senate version authorizes a new Medicaid entity to terminate the CCNC contract upon 30 days notice, effective December 31 2015. And on page 363, the House version instead would direct DHHS to draft waivers to allow a primary care case management entity such as CCNC to require dual eligibles to enroll in case management programs. It also allows DHHS to draft a waiver for LMENCOs to do primary care case management for dual eligibles with a primary diagnosis of mental illness. On page 364, we have a Senate provision

...where the language in Subsection D required this comprehensive program integrity contract, or allowed it to be exempt from review by the State Chief Information Officer and on page 365 you will see the House version removes that language and also contains a technical fix to Subsection B. On page 366, we have a Senate only provision that returns the burden of proof to the petitioner on Medicaid provider appeals at the Office of Administrative Hearings. On page 367, we have another Senate only provision that requires DHHS to withhold payments to providers who owe an overpayment beginning on the 75th day after the notice of overpayment. Monthly withholdings are limited to 11.1% of the total amount owed, which allows the state to recover the overpayment during the 365 day time period allowed by CMS. Then on page 369, we have another Senate only provision that establishes procedures for a party at OAH to seek superior court review of interlocutory decisions, such as injunctions, stays and other types of decisions that are made prior to the final decision in OAH cases. Then turning to page 371, we have a Senate provision that would in Subsection A would shorten the time period for a recipient to request an appeal to the federal minimum requirement for requesting an appeal. That language was removed in the House version and then on lines 43 to 47, the Senate provision would clarify that the recipient always has the burden of proof in appeals at OAH. And then the Senate had language that stated if a Medicaid recipient accepts an offer of mediation and then fails to meaningfully participate without good cause, OAH shall dismiss the contested case. If you turn to page 373, you'll see the House version changed the language meaningfully participate and instead used the words attend mediation. On page 374, we have a Senate only provision, Senate only in the DHHS section of the budget because the House did take this language with slight modifications but they put it at Section 11.20, which is within the education section of the budget. On page 375, we have a provision that is identical in the text, it only has a technical fix to the title that appears in the House version. On page 377, we have a House only provision regarding non-emergency medical transportation. It requires DHHS to issue a request for proposal for a contract to manage state-wide non-emergency medical transportation services beginning January 1st, 2015. On page 378 is a House only provision that directs DHHS to study the practice of reimbursing for ambulance transports that divert individuals in mental health crisis from hospital emergency departments to alternative, appropriate locations for care by examining current pilots, including the Wake County Advanced Practice Paramedics pilot and requires a report on the findings to the appropriation subcommittees. On page 379, I have another House only provision. It follows the money. Steve mentioned it earlier. It requires DHHS to reimburse for Paragard using the same methodology that is used for other IUD's in plan and in ??. On page 380, we have another House only provision requiring DHHS oversight to study the issue of implementing uniform reimbursement rates for Botox for physicians and pharmacists. On page 381, we have another House only provision. It directs the department to report on the PACE program in September and December of 2014 regarding the individuals who are being served by the PACE program, the cost of serving those individuals through the PACE program, as compared to nursing home placement, and a proposal to make the program sustainable. On page 382, we have another House only provision. It exempts individual who are served by the 1915 BC waivers from the Medicaid County of Origin requirement and it requires individuals to be served based on their current county of residence. It requires that 1915 C slots be portable among counties. On page 383, we have another House only provision. This is the one that Ryan covered.

Earlier regarding the appointment of the medicaid director and so we'll skip to page three eighty four is another house only provision that requires C H A S to require or direct C H A S to require that the annual medicaid billing unit limits for services that are managed by the O M N C S to be based on the fiscal year beginning July first twenty fifteen provided there is no fiscal impact to making that standardization and that concludes the medicaid provisions. SPEAKER CHANGES Well thank you Ms. Hill. Thank you very much for your presentations and now we'll open the floor for questions from members Senator Beranger I recognize you. SPEAKER CHANGES Thank you Mr. Chair I have two questions at least at first or two topics to cover. The first one regards the transfer of the summer foods service program. Could someone tell me, I'm assuming that that's for children who ordinarily are a part of the school food program that then covers them in the summer am I accurate or could someone tell me what that's really about? SPEAKER CHANGES Ms. Thompson. SPEAKER CHANGES Ms. Thomas fiscal research. Senator Beranger that is a summer...that program does cover children who are younger than school age all the way up to I think age eighteen or twenty one. And it's currently...it was transferred more than ten years ago from DPI over to the division of public health and this was a floor amendment to have it transferred back to DPI. I think at the time when it was transferred years ago there were not very many schools that wanted to do the program. But now more schools are willing to offer the summer eating program. SPEAKER CHANGES ?? Now that I understand and I did have a basic idea about it you mentioned that it's being transferred to DPI. How will that work? I have some concerns on how they'll be able to implement it is there a plan or program for this? SPEAKER CHANGES Well it's not just for children under school a...it's for children from age zero if you wanted to take a baby with you to a site up to age eighteen. It's usually administered by local churches or other non profits who want to offer the program during the summer months but also a lot of school districts that they choose to be open and offer summer feeding at their sites. And the way the intention is as I under...we didn't have any background on ?? was done on house floor in speaking to the people at public health afterward they were in agreement with the transfer so the entire transfer would just be...I don't think that they intend to transfer the employees. The positions would go but the current employees would stay over at public health. It is a hundred percent federally funded program so the federal allocation will be transferred to DPI. SPEAKER CHANGES Communicating concerns about this transfer from one to the other. SPEAKER CHANGES I have no knowledge of that. SPEAKER CHANGES Follow up on a different topic. SPEAKER CHANGES Yes go ahead. SPEAKER CHANGES Thank you Mr. Chair. I have made several comments in the past about portability of medicaid and I noticed in on page three hundred and eighty two there's at least an attempt to allow for the movement of certain medicaid recipients for that to portable from county to county. The county residents. Does this take care of it finally or are there limitations with this? I thought the department of health and human services was taking care of it internally. I'm just...I'm just trying to get my head around this and see if we finally have a resolution of this portability cause there mentally well there's lots of people that need to be able to take that those benefits and move from county to county whether it's adoption or foster care or mental health or whatever. SPEAKER CHANGES Who would like to tackle that? ?? Blacklidge? SPEAKER CHANGES I'm Blacklidge ?? drafting. This language is intended to allow that portability that transfer. There may be some technical adjustments to the language. We haven't heard back from the department on exactly what those might be but the idea behind it is to allow that portability. SPEAKER CHANGES ?? Well I certainly support the portability and I have advocated for that strongly but this because it's the nineteen fifteen BC waiver will involve the elemy MCA. Are they on board or is this...I want this to happen. I want it to finally get done have they weighed in. Is there a plan to finally implement this so we can check this off and move...

On to other, other issues. [SPEAKER CHANGES] Mr Chair. [SPEAKER CHANGES] Unfortunately I do not know the answer to that question. [SPEAKER CHANGES] Thank you Mr Chair. [SPEAKER CHANGES] You're welcome. Senator Hise? [SPEAKER CHANGES] Thank you Mr Chair. A few things I wanted to go through. First on the CCMC provisions 360-362, I was under the understanding we had originally set a three tiered system and required a zero payment level. Was under the impression that the department was unable to implement that and there was no buy in from the association, that's why we stepped away from that. What are the conditions that have changed in that manner that would bring us to say go ahead and implement what you don't have. [SPEAKER CHANGES] Mr. Blackwich. [SPEAKER CHANGES] Mr. Chair, Senator Hise, I do not know of any conditions that have changed. All I know is that the House took a different approach. [SPEAKER CHANGES] And a comment on those there with the contracts that are on there, and this might be in a question, but, for not having the CCNC this was tied very closely to having a new division that we were creating, and so we were trying to not have the previous department enact contracts that bound the new division beyond the date the transfer was coming in. There's no, and just to clarify for a follow up on this one, there was nothing in the provision on the Senate side that said the new division could not do any contracts with CCNC or extend them out as far as they wished. The prohibition was only on the department as I understood that and we intended to write that. And the next area I kind of want to hit up if I can follow up? [SPEAKER CHANGES] Yes. [SPEAKER CHANGES] Is somebody giving 280, 288 dealing with the copay changes and those type of things, do we have a current number on what the wait list or a best estimate of what we think the wait list is for subsidies right now? [SPEAKER CHANGES] Ms. Landrick? [SPEAKER CHANGES] Senator Hise, the current wait list for childcare is subsidies actually much lower than normal because of the reallocation of funds, so it's around 20,000 right now where it usually averages around 40,000 over a year. Once the reallocated funds, depending on how the budget turns out, if those individuals are on a temporary voucher, so beginning on July they would go back on the waiting list and then you'd again average around 40,000 at that point. [SPEAKER CHANGES] And follow up on those. I guess this is kind of where I'm going with this on comparison of the two. When the House takes, the Senate took the funds and put it toward reduction of the wait list, plus we changed the funding formula to make sure that those allocated slots became permanent slots in those counties, was coming through in this budget year. Do you have a sense of where the budget list, where the wait list would compare between the House and the Senate when the House takes the money and puts it into making each slot more expensive by increasing the market rates and doesn't do the other operations and goes back to the new formula, do you have a sense of what that difference would be in the waiting list. [SPEAKER CHANGES] Senator Hise, Debra Landry with fiscal research, what I can tell you is that after the market rate increases are done and the remaining money is put in towards the waiting list, on an ongoing basis it would be about 2,200 slots, 2,200 children off the waiting list. That happens over time because the House implements the change to childcare eligibility over time. They don't do it immediately. [SPEAKER CHANGES] Do you have another question Senator Hise? [SPEAKER CHANGES] I don't know, follow this in the House and I may be trying to get to questions of maybe things that may have been said in debate or maybe even to intent, and maybe that's a little further, but for the provisions on 327, the transparency acts, as well as 355, publishing the Medicaid payment to providers, did we get any indication from debate or others, what's the House's opposition to transparency and to having that information publicly available. [SPEAKER CHANGES] Who would like to tackle that. [SPEAKER CHANGES] I can. Similar to Ms.

Black legis comments I can only comment that the House chose not to include that in their package. I am not aware of any specific objections. [SPEAKER CHANGES] One last ?? may be simple and then just comment to ??. For the provision on 3 8 and I'm still trying to find the answer to the transparencies myself. 380, does anybody know what the medical uses of Botox are beyond cosmetic surgery? I'm hoping that someone can give me some of those but I'm not aware of them. [SPEAKER CHANGES] Mr. Chair sir, Ryan Blacklitch, bill-drafting, and I'll say this and I will look back cause I know we have...Okay, maybe the press has left. Botox can be used for purposes other than making your face look smoother. What it does and we did a fair amount of research. We looked at the existing medical policy that the department does have on it. If you think about the fact that it relaxes the nerves within your face, there are instances..spasticity, uncontrollable limbs, and things like that. There are instances where injections in particular locations can deaden those nerves' responses and can help with the reduction of pain and also the control of limbs. [SPEAKER CHANGES] Thank you and just, I'm glad to know that there are other uses. I was a little nervous in reading that probation that was coming through. In controlling costs, I didn't think cosmetic surgeries were we wanted to go, that was coming in, but just for final comment in these types of things, I think we're probably about as far apart on the provisions as we are on the budget numbers and I think those are kinda there. I think it's pretty evident to say that this comment has been that there's don't put policy in the budget from the House has been when you put the youth tanning bill in the budget, I don't see really where that came in anywhere else in those operations. I think the largest ?? we've gotta get going forward is what is the future of the department as well as medicaid as a whole and that's the question we're going to have to answer in moving forward, what type of system we're going to have, and what does the department and division look like and those are the large gaps right now between the House and the Senate in spite of all these other significant ones so that was my comment. [SPEAKER CHANGES] Senator McKissick [SPEAKER CHANGES] First, I want to thank the staff for really providing some excellent overview and explanations because I think most of your explanations were very clear, very concise, and provided a lot of very meaningful, insightful data so I appreciate that. I want to comment first about some of these differences between the House and the Senate and then it was one or two questions that I had. I do like the way the House is handling the ?? dealing with the personal care services and terms of providing for an additional year there. I hope that when our senior cares will be able to deliberate. They will be able to see a way to make certain that occurs. I like these ??. We talk about the drug reimbursement ?? the acquisition cost. I'd like to see us continue to advocate for that cause I think that is a smart policy in something that we should move forward with. In terms of the study of the 1915 sea waivers, I'd like to see us try to continue in that direction as well. There were ?? here the House had about and strategic plan dealing with Alzheimer's, something which I am deeply concerned about, something which I think we really need to get jump-started. I know I actually had a study build for that to move in that direction. If this can be worked in the special ?? here in the budget, it would be excellent to ?? to you all, especially the senior cares. The right [SPEAKER CHANGES] Senator McKissick, please stay objective with your comments sir. [SPEAKER CHANGES] Oh, I will. I will stay objective as possible, but I think it's good to be able to chime in in terms of those things that you may feel strongly about, either one way House or Senate. With the right school funding, if there can be a way to continue that effort. I know they have been around for 50 years and the people who do receive services there. If you go and listen to their testimonials, and I've been there and toured that facility. It's something if we can continue would be great. The traumatic brain injury, the study, the services, things which I see there. If there's a way to keep those in there, that would be hell good as well as if ?? ?? ?? healthcare transparency. Now, one thing which I had some questions about that I wasn't certain of that wasn't quite as clear during the presentation was back on page 371 beginning with the

...I guess provisions dealing with appeals for recipients. Dealing with the modification of recipient appeals and dealing with Medicaid provisions, excuse me, Medicaid services. If someone could address what it is that we are doing here and the differences between what the Senate and House are proposing. [SPEAKER CHANGES] Ms. Hillman? [SPEAKER CHANGES] Yes. Jennifer Hillman, Research Division. The Senate version really did three things. In line 7 through 26, where it says Senate only, it shortens the time which a recipient would have to request an appeal with the Office of Administrative Hearings to the federal minimally required amount of time, which is basically before the action becomes effective. They would have until the date that the action becomes effective to request a hearing. Then on line 41, it makes a change that would allow, or require, OAH to dismiss a contested case if a recipient requests mediation and then fails to meaningfully participate. I noted that in the House version, they change the term meaningfully participate to fails to attend. And then on lines 43 through 47, the Senate version clarifies the burden of proof, stating that the recipient always bears the burden of proof in contested cases at the Office of Administrative Hearings, which is consistent with how other petitioners are treated at the Office of Administrative Hearings. And so of those changes, the House did not shorten the time period and the House did not make the clarification of the burden of proof. They only allowed OAH to dismiss cases for failure to attend mediation. [SPEAKER CHANGES] Mr. Chairman, may I make one follow-up on the difference between the House and the Senate on the attend mediation versus meaningfully participate? [SPEAKER CHANGES] Please go ahead. [SPEAKER CHANGES] Ryan Black, Legislative Drafting. Senator McKissick, just to let you know that the meaningfully participate language came from language suggested by the Governor and the issue with meaningfully participate is it's sort of hard to nail down and what this actually creates is a reason that a case can be dismissed. And so instead of using meaningfully participate, by using attend mediation, that then is an objective standard that all of the participating parties could say, yes they attended or no, they did not. And so that's a little bit more in line with the reason that something could be dismissed. [SPEAKER CHANGES] Excellent. I appreciate those explanations. Follow-up, Mr. ??, if I could. [SPEAKER CHANGES] Let me interrupt first. I believe our rules call for us to end our meetings when a floor session's coming up within 15 minutes. But in our discretion, if we can get a couple of questions answered that will finish up our deliberations so we don't have to come back at 5 o'clock this afternoon. I recognize you, Senator McKissick for one more question. [SPEAKER CHANGES] It needs some the same issue. I clearly prefer that language failure to appear. I think its inherently ambiguous when you have to say that someone doesn't meaningfully participate, it's subject to an objective standard, which I think doesn't need to be involved in these situations. Now, the clarification I'm seeking is the Senate would be shortening the time frame for appeals to those that are minimally required. What is the difference time frame wise between what we do now and what the new federal standard would be? And then lastly, I'm assuming that all of this applies to appeals which occur after the enactment and passage of the budget bill, assuming it's a special provision and it has absolutely no retroactive application. But if we could get some clarity on those matters, as well. Thank you. [SPEAKER CHANGES] Ms. Hillman. [SPEAKER CHANGES] Jennifer Hillman, Research Division. Yes, you're correct that this would apply to appeals that are filed going forward. It would not have any retroactive effect. And the current time period for requesting appeal is 30 days from the notice of adverse action and the change here would require them to request the appeal before the action that's being taken and the notice becomes effective. And that notice must be given at least 10 days before the effective date. So it would be the time for appealing would be no shorter than 10 days, basically. [SPEAKER CHANGES] Last follow-up, Mr. ?? and...

Quickly. [SPEAKER CHANGES] Remind me in terms of where we stand now in terms of the continuation of benefits during the bills period. I know there have been discussion of payments not continuing during the bills period but historically payments had continued. Where do we stand today? [SPEAKER CHANGES] Mr. Chair, Jennifer Hillman, research division. This does not change the maintenance of service that applies to recipients and it does not change continuation of benefits which applies to enrollees of LME NCOs. [SPEAKER CHANGES] Thank you. [SPEAKER CHANGES] Senator Robinson, I believe you had a question. Please bear in mind our time. [SPEAKER CHANGES] I will. Just a couple, Mr. Chair. Thank you, and I’ll try not to repeat anything. I want to get back real quick to the summer feeding program. Does that program preclude… I mean does the provision that’s been written in preclude schools from contracting with other churches or community-based organizations to provide those services? [SPEAKER CHANGES] Denise Thomas, fiscal research. Senator Robinson, it does not. They would still be open to other sponsors. [SPEAKER CHANGES] Just one or two other quick ones, Mr. Chair. [SPEAKER CHANGES] One please, ma’am. [SPEAKER CHANGES] We should have cut Senator McKissick off earlier then. In terms of the PCS, and I’m trying to refer to the page… personal care services, with the changes recommended by the House, is that at the reduced rate or does it impact he personal care services reimbursement rate? Home cares went from 15 to 14 to 13, or am I on the wrong thing? You know what I’m talking about, Steve? [SPEAKER CHANGES] Steve Owen, fiscal research. The Senate budget calls for an additional rate reduction. Currently the rate that’s approved by CMS is 13 dollar and 88 cents per hour, so under the Senate version, that would be reduced even further to compensate for the additional 50 hours. Under the House version, the 13.88 stays intact, but there is the study to actually look at a brand new PCS program altogether. [SPEAKER CHANGES] I’m sorry Senator Robinson; I must end your questioning now. Senator Van Duyn, I believe I saw you had a question. You can bat cleanup for us. [SPEAKER CHANGES] Yes, I have a question about CCNC, pages 360 to 362. My local CCNC, CCWNC, maintains that they’ve saved significant Medicaid dollars. Am I understanding that this zeros our funding out in the Senate version? [SPEAKER CHANGES] There’s not a zeroing out of the per member per month payments. Last year’s budget required the payments to be made by CCNC. I believe the policy argument was that there was a disconnect between the department which was making the payments and CCNC, which was trying to get doctors to participate meaningfully in the programs, and so the reasoning, as discussed, was that the money would go from the department to CCNC and then they would pay the per member per month, and it would be paid on a tiered basis on the basis of the doctor’s participation in the CCNC initiatives. [SPEAKER CHANGES] Thanks everyone for your attention. Session begins at 3 o’clock and I appreciate all of the good questions, good answers, and thank you audience for being here. We are now adjourned.