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Senate | February 13, 2013 | Committee Room | Health Appropriations

Full MP3 Audio File

I know more about the work that we do you airman everyone has heard about Atlanta elitists are many other things besides and it's not the majority of the employees work in other divisions for that reason I have asked Sherry Bradshaw was our acting director of human services to highlight a few of these areas Madden chair relief astrocyte Pratchett to be limited to place and the secretary thank you matters are committee members and 10 At the secretary authority yet is a large, flat umbrella agency serving North Carolinians from Arctic cat when I see his hundred and 56+ I said I like all today and tell you about is certain that but highlight for you Son of Man and give you a sense of the from department issued certificates and assets in stocks from the very beginning of line reinspect channels we help children get off to a healthy start with the fact that social emotional development as well as school readiness in 2012 it will report the child is the neglect involving I hundred and 60,000 Hundred and 76 10,000 children living in North Carolina is DHHS is an accounting agencies and the responsibility of assuring for these children's safety in 20 wow approximately 14,140 children in foster care services when protection the only way to provide for their safety within an hour high placement many of our children are raised by one parent's house for the last $714 million in a long time friend and 30,134 child support case that adults who are elderly or have a disability can find themselves in vulnerable situations as well last year as 15,000 of our adults living here in our stand where it stands to a Sheridan air safety from abuse neglect or exploitation department is responsible for ensuring that all accountants are able to launch in think the system which you have heard about before one rolling it out in faith in counties will experience a higher level of efficiency and administering services like food and nutrition services for the United States stands work first childcare and working with counties to refine the implementation strategies were rolling out the final nominees for aftermath in the next 45 days at state nutrition services as phase 1 comes to completion when caring for the future implementation of Medicaid and work first we are working with counties in which the Democrats training and readiness activities we have boots on the ground in all counties during the first few meetings and are paying attention in class link to our larger counties and their implementation implementation is difficult that full implementation events if at the know seeing all that stands retired for her say summer more than 30 years now contain only part of the information that we need to effectively administer these programs and services Sustain on the course pilot counties are beginning to see the efficiencies that describe membranes instead of manuals that are being sent Marines a policy that workers must number as the new system moving forward will calculate benefits and provide greater accountability for results will prevent fraud and abuse and waste in our system we provide so supports to individuals and families experiencing hate health and safety needs to assisted living successfully in our community are often able to fully participate in the workforce

services, independent living services and the provision of assisted technologies are critical to their success. I want to also mention our state operated health facilities. There are fourteen of them, with eleven thousand five hundred employees that operate partially using the two hundred and seventy five million dollars in state appropriations that this body makes available. We offer reduced cost medications to tens of thousands of North Carolinians. When needed medications are available fewer emergency room visits are necessary. With the limited time that we are offered we are only able to cover a fraction of what we do, but let me leave you with a few of those things that we manage that are less known to the average person. We regulate tattooing, tanning and jails. We manage a number of registries to ensure that no one that should not be working with our children or vulnerable adults has that opportunity. We play a large role in the preparedness and recovery of emergency medical situations and natural disasters and we operate a state of the art health lab. And a last service to leave you with but definitely not least of importance-- we manage a radiation protection section and work with the radiation protection commission to promulgate rules, ensuring again our safety. Thank you, Madam Chair. Thank you committee members for your time and this opportunity to come before you and share. Madam Chair, at this time I'd like to recognize our secretary for additional comments if that's appropriate. [SPEAKER CHANGES] Yes. Thank you. Secretary Bosch. [SPEAKER CHANGES] Thank you, Sharon. So as you see, in our department we really do owe quite a large diversity of stuff and it effects a lot of people. We are in a period of enormous change right now in our health care. What we do at HHS effects not only the budget for this year or next year. It will greatly effect the future of the children and the grandchildren of North Carolina. Our actions at HHS will be consequential. Now let me tell you how I found the department and how it was run on day one when I showed up. When I first came to the department people, our staff, was bringing papers to my office, dropping them off. The papers had no name, no contact information and asking me for signatures for something that needed to be done urgently. One day and one of my first days in the office a high level staffer ran into my office, visibly flustered and distressed, saying I absolutely needed to sign this contract at that moment. I asked her first to calm down and to please explain to me what the contact was for and what exactly she needed from me, but she was unable to provide the information to me. But she said she thought it was a couple of million dollars contract. And just last week legislative reports that were due in November, December and January showed up on my desk. Not only were these reports months late but they were simply incomprehensible due to the thickness of the report. It was stuffed with acronyms and lots of fluff. Some of them were so industry specific that no person could possibly decipher what was trying to be relayed. So I since issued directives to our senior staff and subsequently to the entire HHS team that all signatures that are required by me must be on my desk at least a week before. That they must come with a simple one page cover sheet that includes the person who's responsible for this, perhaps a grant name, perhaps a signature of the supervisor and a request whether this is state or federal money and some bullet points, a simple summery of what is being asked. So with all of this you can imagine my displeasure when again I was asked to sign a legislative report that was a week late. So, there are no longer points of contact at HHS. There are simply people who are

responsible and accountable for completing a given task. We actually have begun to simply issue our first warning letters that are entered into the employee personnel files. We are not going to change the system overnight or this process, but we will change. It is absolutely unacceptable for business as usual for reports to be months behind. Now I have set this expectation for our department that we will adhere to the deadlines and that we will provide you and the committee and staff with information in a timely manner and in a usable format that is useful. But to make this work I also am asking for help. We need to work together to eliminate all consolidate certain reports. Too often the reports that we are being asked to produce fall short really of providing you with actionable data and do not help any of us in policy making. We actually have daily information requests daily for information and we are asked to provide 150 legislative reports per year. That is equivalent to a report every Monday, Wednesday, and almost every Friday. In my show and tell here is the result of a legislative report printed on both sides. We received a request January 30 asking for it to be returned in seven business days. Now this report is just not computerized information. This report contains specific information of over 1,000 contracts. This report is a lot of work on our budget team which has to handle, which has actually their hands are very full right now with multi-million dollar holes that we have to patch up that have been left to us by the previous administration. I believe this is the root cause of some of these issues is simply the lack of trust. It was the lack of trust by you towards our Department of HHS. I firmly believe that the legislature was not receiving the data when it needed it. So you required frequent reports to ensure that you did have it on hand whenever it was necessary for you. So we need to improve our communication and find a better way to share information in order so that we can restore our mutual trust. So let me continue to share with you some challenges we have. Number one, one of the challenges we have is to create an organization that promotes the efficiency of the entire department. Let me read to you just a simple list of one division and offices inside of HHS. Well in one division we have Human Resources, Purchasing, Contracts, Property Construction, Privacy Security, Internal Auditor, Facilities Controller, Equal Employment Opportunities, Information Technology, MMIS, NCFAST. Now what could possibly tie these seemingly unrelated divisions together. Well they all reported to one person. By the way that one person actually just retired and there is no succession plan for that position. We are also running extremely thin in HHS. We have many key positions that are vacant. More than half of the Deputy Secretary positions inside of the department are vacant and have not been filled yet. We have many vacancies that are waiting to be filled, including critical ones such as 20 doctor positions that are presently unfilled and waiting, waiting. We are facing numerous retirements over the next few months. Well and of course there's the money issue was face.

my first week on the job, I sat down with our budget team, and I was handed a number of sheets of paper. One of those papers was over $4 million that actually was due due to an error in communication. Another piece of paper was for $5 million, the $5 million that was a reduction, that actually was mandated by law in 2 straight years and had not been enacted. A third piece of paper was nearly $40 million of unpaid bills that we walked into. And finally our legal troubles. I've inherited a Dept. of Justice settlement that is back loaded with costs that need to be in your budget for years to come. This amount is nonnegotiable due to the settlement. You can find an update in your printout about these costs. And it must be my short name because it seems I'm the most popular person to be sued. I already have in this short time my first supreme court case. And I also mentioned my legal team, and why do I mention that? My legal team, she is very talented because I only have one. So, why do I tell you all of this? I need you to understand what we are facing at HHS. I need you to know that things are really broken, but we are in the process on the path to fixing it. The solution is not coming here and asking for more money. There is no new money. There's no one in North Carolina, certainly that I know that is raising their hand and actively waving and saying "Please, please, take more taxes from me. I want to volunteer more money in taxes so you can give it to HHS ." So what exactly is the plan, and what exactly are we going to be doing? First we will be driving efficiencies into the organization and the department. And those efficiencies will be through technology, accountability, and structural reform. We will enhance existing talent and new talent, we will make sure that we have the tools that our staff needs. I would like to finish with the 2 top priorities for our department: Our top priorities are IT and medicaid reform. Even as we tighten our belts everywhere, we must continue to invest in technology across state governments. With that said, at this time I would like to introduce our most recent hire, our chief information officer Joe Cooper. Joe started last Friday and we're thrilled to have him here. Joe will be responsible for overseeing and ensuring the success of all IT projects within HHS. This is actually the first time that all IT projects are aligned under one individual. And this will give HHS a more cohesive approach to the IT projects, operations and budget, and allow us to better utilize resources across our entire department. Joe has 35 years of experience as a technology executive in the private sector. He has worked for 35 years in leadership positions, in such organizations as RBC, First Citizens' and Bank of America. The first priority of our new CIO is to evaluate the technology needs for this very, very diverse operation while instituting a culture of consumer service. Madam Chair, I would ask Joe Cooper be allowed to address the committee. [SPEAKER CHANGES] Mr. Cooper? [SPEAKER CHANGES] Thank you Secretary ??. Madam Secretary, many Chairs, committee members, good morning. My name is Joe Cooper, and I'm HHS's first Chief Information Officer and perhaps just as important, to you as I will be your one throat to choke when it comes to information technology for the agency. I

Energized by the opportunity to partner with Secretary Was in the state of North Carolina to tackle one of the state's biggest challenges: healthcare information management. I've just completed my third day in the job, and so far we've just consolidated three organizations into one: the Department of Information Resource Management, Health Information Technology, Privacy and Security, and will be looking at other consolidation opportunities over the coming months. I've also assumed leadership accountable for MMIS, NC-FAS, and all the other technology-related initiatives in HHS. Most of my first three days have been devoted on getting up to speed on the MMIS and MC-FAS initiatives. I have additional meeting scheduled for this week, and through next week as well. The remaining time has been spent with some division heads. It's still very early, but one of my first observations is how dated the technology some of our divisions are using, and the impact it's having on them. One good example is our controller division. Today, the PCs and software that they're running is so dated, that when they received spreadsheets from the State Control Division, the State Control Division actually has to split the spreadsheets into two, so that they can ship it across the communication lines. And just compounding that further, often times they have to downgrade the spreadsheets so that the spreadsheets at the control division can actually bring them up and do work on them. I will be spending more time with the individual divisions in the coming months, trying to identify opportunities to enhance our day to day operations. As I stated earlier, I'll spend the bulk of my time over the next few months on MMIS and NC-FAS. I've told my colleagues and peers at HHS that I have to focus on this. We will certainly entertain new initiatives and new requests, but I also prepare them for the answer of no. We have to focus on these initiatives. We have very hard target dates that we have to achieve. I should have a much better line of sight about these initiatives in the coming weeks, and I look forward to coming back and reporting a complete assessment back to the committee. Thank you, madam chair, committee co-chairs. I'd like this opportunity to call Secretary Was back up. Thank you, and welcome aboard. Secretary Was? Thank you, madam chair, and thank you, Joe. Next, I'd like to ask Carol Steckel to speak. I'm sure that you've already heard about our new Medicare Director. Carol is one of the top three in her field in the nation. Recruiting her away from Governor Bobby Jindal in Louisiana was the first big victory in HHS. Carol is 100% focused on Medicaid reform. Our state cannot sustain our present Medicaid program as it is currently focusing. Carol has hit the ground running, and has invited all the stakeholders to the table with, as you know, the request for information that was published in our state last week. The excitement of hearing from across the state is actually quite incredible. We've offered the people to come to the table with great ideas, and people are actually saying throughout the state, quote unquote what took you so long to ask us? Madam chair, I would like to ask Carol Stucker to be allowed to address the committee at this time. Ms. Steckel? Madam chair, members of the committee, I am thrilled to be here, and thrilled to be in North Carolina. There is a great history here of innovation in the Medicaid program that is focused on community-based services, and I am excited to be part of moving this into the future, and appreciate you all letting me address the committee. The RFI was released on February 4th. We are asking people, whether they're individuals, they're stakeholders that represent providers, whether they represent advocacy groups, to submit bold proposals on how we can improve the Medicaid program. We only outlined basic principles, because we did not want to drive people into specific areas, we wanted to get their ideas. Those basically

[0:00:00.0] …Principles are that the proposals to be market based and utilize North Carolina community based providers, proposals that enhance the beneficiaries personal responsibility not just for me to think about financial responsibility but for their own health care responsibility, we want proposals that provide optimal level of benefits to appropriate recipients at the appropriate level and at the appropriate time. We want proposals that provide both short term immediate savings to the medicate program but then also build a sustainable predictable medicate program for the long run. We have asked respondents to describe how their proposals will create a system where there is more appropriate care at lower cost with better outcomes with not just buying products and fee for service systems but how are we showing that we are improving the health status of the people we serve. We are looking for the proposals so utilize and accepted and verifiable financial and quality measures to evaluate the effectiveness and the efficiency of the program, we are not asking you all to take our work floor we are going to build systems that allow us to quantify and measure the success of the program. We are looking for proposals that address the need, the important need of the linkage between physical health and mental health and behavioral health that would be a major initiative and will be working with our department of mental health to have their input on evaluating those proposals. We also have asked people again under the category of thinking boldly to not measure just this area or this area or this area but to look across the continual care including long term care supports and services. Most of all we are looking for proposals that focus on improving the health of our citizens here in North Carolina. The schedule for the RFI questions about the RFI formal questions are due tomorrow, we will then answer those questions and post both the questions and answers on our website. Proposals are due on March 15th we then will take with the Department Of Leadership and with the DMA leadership, we will look at those proposals and build a comprehensive proposal from all of the ideas and then that will be the tool that we use for going back out and getting suggestions for modifying it, tweaking it and that will be the proposal that we submit to the Secretary and to the Governor and to this body. I don’t need to tell you that medicate needs improvement I think you all have heard loud and clear from several auditors and other entities. This program is something I have spent my life working for and it is a passion of mine, it’s a program that’s too important, the services we finance are critical to the wellbeing of the state. However, I recognize and my staff will recognize the obligation we have both to the beneficiaries that we serve but also the tax payers who have interested their hard earned money with us in the programs that we operate. In addition to the group __[03:17] effort that we have identified in the RFI of one to assure each and everyone of you that we are reforming internally. The Secretary has outlined some of the issues and we will not have another auditor report like I had two weeks ago, I can promise you that. We are worked to restore trust of the agency, we look to work with you and your staff to be transparent, to provide you the information that you need and again we will not have an audit report like we had two weeks ago. I’m excited about this initiative to look forward to work with each and everyone of you and your staff because this is as the Secretary stated a legacy that we can leave for our children and our grand children and something that I think we all will be very, very proud of and all of us have a part to play in making it happen. Thank you very much and Madam Chair this time I would like to ask the Secretary to come back. [SPEAKER CHANGES] Thank you Chair and thank you welcome to Ms. ___[04:20]. We are glad to have you in the North Carolina. [SPEAKER CHANGES] Thank you and Madam Chair we have several senior staff here that could possibly answer questions and not possibly but they can answer questions and provide further information to the subcommittee on request. We have senior staff here in reference to subject matter of Managed Care, HHS budget, Department of Justice Settlement, our facilities and C-Fest, MMIS, Adult Care Facilities among other topics. [0:04:59.9] [End of file…]

[0:00:00.0] Thank you very much and I’m sure there will be questions from the committee, okay. What I would like to do and how we work the Secretary of ___[00:10] Podium and when we direct the questions to Secretary and then she can hold upon the appropriate staff person. Senator Hise. [SPEAKER CHANGES] Thank you Madam Chairman and the Secretary, the first question that I would like to address on has to do specifically with the budget and where we stand for this. When the department reported in early January, the General Assembly, the prospects their budget they said we were looking at somewhere around the 20 million dollar surplus for this year, if you look at, we took a look at check rights compared to the last year I think I’m seeing the trajectory for a 300 million dollar deficit coming in this current year and I was kind of wondering if you had someone who can give us an update on where you expect your budget to be… [SPEAKER CHANGES] Thank you if I could, please call on ___[01:06] budget to Mr. Jim. [SPEAKER CHANGES] I think that would be Steve related to medicate… [SPEAKER CHANGES] To medicate okay thank you. [SPEAKER CHANGES] Steve from the Divisional Medical Assistance excuse me, based on that we are in the process of doing January forecast and for the rest of year but based on December, if you look at all medicate funds which include claims as well as settlements, administration and contracts. Today we are looking about 21 million dollar shortfall of total expenditures. As you look at our check rights and we are spending the first half of the year I think it’s important to add a couple of things. One, this year we only have three settlements, payback excuse me to the Federal Government of all that happened in 2009 so the first half of the year it was heavy and we also don’t have the 40 million dollar PCS payback, the way the savings particularly with the MCOs or ___[02:08] because as we implement the MCO we have the first month payback and PMPM is still running claims. So, those settlements were also and we are begun to see those materials in the last four months of this year. [SPEAKER CHANGES] Follow up. [SPEAKER CHANGES] That 21 million dollar, is that include making whole of the payments to the Federal Government in June as required by law for the 125 million dollars in rebate? [SPEAKER CHANGES] No, that assumes it will handle the Federal share of the rebates the same way we had this past June so that’s an item will be added to that number in terms of what we actually have to cover. [SPEAKER CHANGES] Follow up. [SPEAKER CHANGES] One other question, differ subject and I think this will probably for Mr. Cooper in MMIS and I know the two are new to us but I think the elephant in the room kind of question for MMIS is what at this point, what kind of likelihood do you see that MMIS will go live on July 1st and will be fully functional and implemented by the second iteration. [SPEAKER CHANGES] Thank you for the question, we will be ready July 1st to go live and as you mentioned in January timeframe we are continue to make additional enhancements stuff through the rest of the year but we will go live July 1st. [SPEAKER CHANGES] Okay, Senator McKissick. [SPEAKER CHANGES] Thank you Madam Chair and Madam Secretary I had a couple of questions so I wanna thank you, I’m always hopeful to get insight full information that can help us and making reasonable intelligent proceedings. [SPEAKER CHANGES] And I’m gonna post three questions and you try to bring up the staff that can help us to answer the more and having describe an agency that apparently is a NETO significant reform it seems to be ___[04:09] prospective somewhat dysfunctional. Are you planning to address that by perhaps putting together a team that can do fact signing and determine what the best organizational structure would be or bringing the consultant that can help with that? Secondly, in terms of industry fest and I have heard something about it for the last four or five years. I’m trying to determine where we are with industry fest has today in terms of getting it fully operational, how far that timeline it stands? What kind of cost fully involved with our decision not to drawing the money that was available to us to upgrade it for some of the medicate enhancements that need to be done, how are we planning to fund it? And lastly, the development disabled, I know we have some stuff got make in place today, it will address that issue but what are we plan… [0:04:59.8] [End of file…]

[Speaker changes.] We could do longer term, within the next 60-90 days to put us in a position where we could have a fix for the problems in that area. [Speaker changes.] I thank you Senator. Perhaps if we can start with NC Fast?????? because I know that is of enormous interest and I would like to request perhaps Anthony ????????, if you could be kind enough, in detail, to answer the question about NC Fast?????????? Thank you. [Speaker changes.] Thank you, Madam Secretary. To answer the question as far as where we are with NC Fast???????? We've broken it up into multiple projects, like we've reported on numerous times in the past. The first project is the ????????? Services Project. We are in 76 counties live right now. All systems used for entire medic...for entire food stamps program?????? both re-certifications and new applications. The remaining counties are doing new applications only within NC Fast??????? We have two roll-out phases, one in February and one in March. In February, we'll bring on another 21 counties including some of our larger counties like Wake and Durham so they'll be live, 100% in NC Fast??????? and no longer using the legacy system. In March, we bring on the final two counties, which is Mecklenberg and Forsyth county. Just due to the large size of Mecklenberg and Forsyth, we want them by themselves in March, which will complete our Project One roll-out of NC Fast??????, from a system perspective. We're also in the process of going back out and starting to train all our Medicaid workers on how to use NC Fast?????? from a universal place worker concept since NC Fast is no longer in stove pipe systems but all into one consolidated system. So we'll start training our Medicaid workers on using NC Fast??????, using the food stamps applications and things like that. The Medicaid Project, you refer to that as Project 26. Medicaid will start rolling out in June of this year and we will pilot in June and July and then start rolling out to all the rest of the counties. And a phased approach, just like the lessons that we've learned with Project One so we're not gonna do this big bang...we're not gonna roll out in good massive data for every county, we're gonna roll that out in phases. A soft launch and a hard launch. The soft launches are basically they can use NC Fast????? for all new applications for Medicaid and all the other programs and by October first, all 100 counties will be using NC Fast?????? for new applications for Medicaid ?????????? healthcare reform. After that, we'll do our conversions of our legacy system from the Medicaid system into NC Fast????? over the next several months just like we did with Project One. When it comes to the benefit exchange aspect of it based on the legislation over the last coupla' days and weeks, we have now created a new project called Project Seven. It was never really part of NC Fast to do the benefit exchange piece. It was always a separate effort. It would still integrate completely with NC Fast but keep it separately from a cost allocation perspective. Under Project Seven, you asked about the funding of it. Currently we do have the grant utilized from the federal partners to implement the exchange; however, based on the legislation, if it ran...when it becomes law, we cannot use that grant going forward. In the process of preparing for that, we've created...updated our annual planning document which is our federal approval document from our federal partners. We'll be able to submit that within...by the end of this week or early next week to obtain the 9010 funding for the exchange portion of NC Fast and to make NC Fast perform all the Medicaid eligibility for anybody coming in through the federal exchange or the FFE model, the Federal Facilitated Exchange model. Did that answer your question, sir? [Speaker changes.] Yes, it did in part. I guess...follow up, Madam Chair? [Speaker changes.] Follow up... [Speaker changes.] In terms of...first, I'm very pleased to hear the food stamp certification part is finally where it needs to be cause we been workin' on that for a long time. So I commend you on that effort. I guess the other thing is the cost. Where do we stand in terms of overall cost for NC Fast? How much of this will perhaps be recoverable from other agen...from other funding sources? Perhaps federal? And how much is it that we're gonna be looking at moving into this budget cycle...and I'm not sure if we have all aspects of NC Fast that will be completely operational soon from your comments? Sounds like there's still a ways to go... [Speaker changes.] That is correct, sir. We have additional projects after the Medicaid project starts rolling out this year. We have Project Three, which is childcare, crisis intervention and??????????. Right now that's scheduled to start sometime this fall. We have Project Four, which is child welfare, child services, protective services. That was originally scheduled to start actually this year. We did submit out paperwork to get that approved from our federal partners but we've had some resistance when it comes to the cost allocation of Project Four so we're still working with our federal partners on that. Project Five is ???????? protective services, which right now will start sometime in 2015. We're always trying to expedite projects to maximize...to go to your other question...on the funding. NC Fast right now, based on the waiver that the CMS received from 87A is funded 9010. In our cost allocation, we put those 9010 figures in there and then run all the different function....

within the system. Reality is it’s actually like 88.9% federally funded and a little bit or more than that on the state side, primarily because of the function points. Food stamps, for example, under emergency food stamps is not benefitting of any other program so that has to be 100% USDA. The 50-50 match what the USDA provides. Overall our funding is 90-10 in the short answer for that. When it comes to NC Fastfunding, we’re funded for this fiscal year. We have applied for our next fiscal year. The exchange site is slightly different, as I mentioned before, we were fully funded under $45 million for the exchange piece with the grant not being able utilize the grant we have to now come up with the state dollars for that while we seek federal approval for the 90-10. We do anticipate receiving a federal approval, which would be a 90-10 match, but in the short term we have to continually fund NC Fast for the exchange project to keep moving to hit the October 1st date between now and when we obtain that approval. That approval can be as long as 60 days from now, and there’s obviously, just like any other approval, there’s not guarantee that we’ll get that approval. [SPEAKER CHANGES] Thank you, I think that helps a lot. One thing that would help Madam Secretary. [SPEAKER CHANGES] Follow up. [SPEAKER CHANGES] Follow up, Madam Chair, excuse me. If we could at some point get a comprehensive document. I don’t want to burden your agency with any more reports because you can obviously are overburdened already. But something that’s short, sweet, and concise that can kind of give us the long term costs for NC Fast in terms of what we’re looking at and what our contribution as a state would be. Particularly going into this budget cycle, but I think if we can get the more comprehensive view looking out several years, the other components, that would be helpful as well. [SPEAKER CHANGES] Senator, we can get that over to you fairly quickly. Actually very quickly we can get that to you. With the information that’s available for us, we do not have a crystal ball, with the facts that are available to us, we will get that information to you very quickly because we do have that. [SPEAKER CHANGES] Excellent. [SPEAKER CHANGES] And your other question. [SPEAKER CHANGES] I’m sorry, and then you had two other questions. The first one you had mentioned was organizational. Senator, I suppose in a dream world we love to have the time and the finance and the ability to hire outside consultants to come spend a year with us, see where our weak links are, see what the best corrective action is and then spend another year asking you for more money and trying to figure out how to do that. I don’t think we have that time. Where we are right now is we are implementing changes, organizational, structural changes. They will have a direct impact just by, as you see, by the caliber of the folks here and also our new hires. You will see those changes very quickly. I promise you that if I assess that we are not able internally to go towards a path of sustainability, I will make sure that we ask for outside help, outside consultation in order to accomplish that. [SPEAKER CHANGES] Thank you. Madam Chair. [SPEAKER CHANGES] Follow up. [SPEAKER CHANGES] Yes, follow up. The last component was the developmentally disabled. I commend you, if we had a dysfunctional organization and it can enhance our delivery of services, this is in the state we need to be about correcting that as expeditiously as possible. [SPEAKER CHANGES] Yes, sir. The reason that the two goals in the department are IT and Medicaid reform is if we do not have the tools and the money to work with, then all our efforts towards what we should be working on on helping the citizens of the state, we can’t do it. Our focus is on IT and Medicaid reform in order to make it have a path for them to be functional, efficient, sustainable for the future so we can devote all our efforts of the expertise our department to concentrating on things as disabilities. Who would like to, of staff, perhaps answer, because many of us are involved, I’m seeking who would like to be the first. Kelly? Thank you. [SPEAKER CHANGES] Kelly Crosby, Division of Medical Assistance. You had asked about services for individuals with intellectual developmental disabilities. What I can tell you, I will start, I think someone else needs to finish. I’ll tell you about the Medicaid services and where we are right now. At the moment we have a 1915C waiver is our innovations waiver. You know that you have us 250 more slots last year so we were able to give those slots out.

in January of this year's so we have a virtual thousand people right now on that C waiver and that does provide home and community based services for individuals with intellectual and developmental disabilities, so they can live in homes in the community and not in institutional settings. We do have wait lists for those services, and we do rely on additional funding of slots in order to create new community based services for more people. Because that C waiver is tied to our 1915b waiver, which is our managed care waiver, we are able to use some of the savings created under managed care to provide additional services for medicaid ineligible individuals on the wait list for those C waiver services. So they get some basic services like community guide and respite. And they are, it is a specific amount of money, it's not a entitlement. The individuals on those wait lists as well are obviously entitled to the entire medicaid benefit, and that's something that's been very important that that community is aware of. They do have access to healthcare durable medical equipment, mental health services, whatever the medicaid benefit allows, and some of the services are able to support some of their other needs. We do also provide institutional care, they're called intermediate care facilities for individuals with intellectual and developmental disabilities. That is a basic medicaid benefit. And we had submitted to this committee- excuse me, to the blue ribbon commission our recommendation for a 1915i option service, which is called individual supports. It is a service that provides habilitation and respite. Excuse me, habilitation and personal assitance type service for individuals who do not have a slot, who are medicaid eligible. This service would help support them in their home or in group home settings. This would perhaps help individuals who may be losing personal care services. Now that is, we just submitted the outline of what the service would look like. We obviously need permission and a budget to submit, but that option officially to CMS for approval. Now those are the medicaid services, and you may also be asking about some of the state funded services for people with IDD. [SPEAKER CHANGES] Do you have an appropriate person for that, Sen. ?? [SPEAKER CHANGES] I can address that Madam Chair. [SPEAKER CHANGES] Thank you very much, thank you. [SPEAKER CHANGES] I'm Jim Gerard with the division [SPEAKER CHANGES] Please identify yourself please. [SPEAKER CHANGES] Jim Gerard with the division of mental health, developmental disabilities, and substance abuse services. In addition to the medicaid services, we distribute to all of our ?? MCOs, the local management entity, managed care organizations, service dollars which come from you which we distribute then according to a formula for each of the LME MCOs. The largest portion of those service dollars spent on mental health, developmental disabilities and substance abuse services are spent on persons with intellectual and developmental disabilities. So through each of the local management entities, there are services which are being funded by state dollars, some of which are payable for it by medicaid dollars. And so together with medicaid, we feel like we have a very broad range of services available for persons with intellectual and developmental disabilities. [SPEAKER CHANGES] ?? [SPEAKER CHANGES] Madam Chair, quick follow up? Yes, ?? from the first person ?? in terms of submittal to the Federal government, when will that likely take place, and what's the time frame for perhaps getting a response? [SPEAKER CHANGES] On our reports to [SPEAKER CHANGES] Excuse me, if I could, if each of you, I know you speak 2 or 3 different times, but could you identify yourself when you speak? You've got your back to a lot of people. [SPEAKER CHANGES] Oh certainly, sorry. It's Kelly Crosby from the Division of Medical Assistance. We did submit our report on the "i" option to the blue ribbon commission Feb. 1st. It does only outline a projected budget, the projected number of eligibles, what the service would look like. But because we don't have a budget for it, or authority to actually submit an application to CMS, we- it is very early projections. There would be quite a few steps in terms of getting permission, a budget, truly developing a fiscal note to look at the cost impact of the services, and then it would take at least 90 days, perhaps more to get federal approval for the service as well, so... [SPEAKER CHANGES] Identify yourself please. [SPEAKER CHANGES] Madam Chair,

Also my name is Brawnsly medicaid director we have other mining's Cal state MIT to render the African colony and all of the states this is part and parcel of RFI which with an eventual services for the comprehensive look at its patients entered sell an SMU patients on mission and we're not looking to the delay and are finding that prices slightly but this discussion about ATT I’m other services that we and our slinging two Waiters let (SPEAKER CHANGES) Congress S's proposal to defend and that looks at ARCO site for patients entered comprehensive are inflated will be doing again make and how often are doing is working on in that 3555 cents aging men share information and secretary to take away from bringing your team with you think it's a retention plan was thinking and cheerful, automation, questions the hungry much appreciated presentation and on the cleaning staff the Packard , and most of the job and they'll be going, we we know this is a huge task and would like to continue encourage you to stay on as middle of talker years about Medicaid and in the form of HHS, this time really talk about real reform not just in a public service I will questions from two would be helpful if U.N. staff to give us an update from the organization structure in the key folks are your structure so we knew issued and changed without those individuals ,(SPEAKER CHANGES) I'd be interested in knowing how all these unfunded liabilities. Within the projection of these actually considered we talk about the projection for this year and he's been taken into account in that projection and depends very much for your questionnaire that the first part of the questions that have we learned, IC but I think it's SN lee organizing seven you when you will have a draft form of Arabica organization senior staff IBM and probably find my stool closer into the end of march that message was fighting for a CSF and we'll be able to provide are are information act in reference to the CF to happen Friday with a 5000000, 4000000 & 8000000 dollars 1,000,000 La Rental proposal reacts two together and said perhaps it's disturbing to sell at the head of terms like Nancy N-NFIEI think you'll be pleasantly surprised when all of which , we see compared with, feeding into your overall plans in advance that snakes and questionable accounting procedures set on expenses and served as a starting point to its phone at Cal state (SPEAKER CHANGES) a director of the parent of Caroline and he is something that many states are trying to help now sell you would be irresponsible to take a system that UC State and are in an ordinary day baseline system and not built on a cell when my we haven't defined back in spring and submit proposals to screen cannot but all I can really see the principles and, if I buy the full RII is on our web site that all his mail from winning Sierras now I don't think he's only bring the correct sentence from the area and I don't think they're doing everything that they can to sell what we're looking at is having an outcome to use the technology term in Reedley L how can we deal with the bill some missiles and the other organizations and I turn and medical neighborhood Sebring and Physicians to bring in and and the success of and you bring in a hospital if you bring in attendance is adds another component and a lot of people don't realize how to create the board to help hearings are taken for pregnant women again also for our help, cardiac health and other indications but have we bring in all of its compliancy and being patient center are looking at how we do best practices how we get the best practice information out to live for minors and how we better meanings in a comprehensive way back outcomes are sat here vs. we paid for four MRIs 3833 we have a wrapper stops the procedures would never sell through the critical component of the would not I would not be responsible December '90 backing in these….

Anything different. It has to be built on the success of North Carolina. I was the Medicaid director in Alabama for ten years and they’re now going through the process. They had two committees to look at Medicaid reform, a legislative committee and a gubernatorial committee. Both committees said we need to look at the North Carolina model and go forward with that. And there’s states all across the country that are looking at that so our goal again is community-based services. I don’t want to close off any potential opportunities elsewhere, but that’s our goal. [SPEAKER CHANGES] Thank you. Thank you. [SPEAKER CHANGES] Follow up. [SPEAKER CHANGES] Senator Robinson. [SPEAKER CHANGES] Thank you, Madame Chair. And thank you, Madame Secretary. It is certainly a pleasure to have you here, not just because you’re from Gilford County, but because of all the assets you bring to us here. We want to welcome your new staff, especially your Medicaid direct. I want to have some time with her too. A couple of things I’m concerned about. I’m so glad to hear about NC ?? and Joe, and connecting the information. I never could understand how we could put information into a state system and couldn’t get anything out. I just could never understand what was wrong with that whole thing so I look forward to that gap being closed. I am concerned, however, our mental health services and our developmental disabilities. I think it’s a broken – I know it’s a broken system and I work closely with those areas. I know a lot about them. I just dealt last year with Bill House, whose people had to leave there because they didn’t qualify any longer, older parents who had a child with developmental disability who was an adult, who was going to have to go to some individual home. That was not the place for that person to be and yet, they did not fall up into the group home regulation. They need to do that. I think we’re doing a lot of things wrong to look after our citizens who have developmental disabilities and who have mental health problems. So I certainly like when you get some of this other stuff handled, that you take a look at that. I’m glad to hear about the 1915 ?? because I think that’s going to help some. I really think that’s going to help. I think you need to look at the whole system. I know that we have some federal regulations that tie in some, but wherever we can close some of those things, to make sure that we provide the same quality or good quality of life people with the ?? disabilities and mental health problems. I’d like to see us do that. I had one other question. When you talk about the 1915 ??, are you still using the cap money and how is that going to… how much is that? And how is that going to fit into the overall new plan? [SPEAKER CHANGES] Thank you, Senator. First, I want to reassure you that we have mutual goals and in reference to mental health. Mental health is one of the… really, part of the work that HHS does encompasses all of us across the board, everything from a person’s own dignity, to their family, to society, to school, to education, to public safety, to absolutely every part of our lives in North Carolina. I promise you that in reference to our comprehensively looking at the issues of mental health outside of HHS, we will get to it. We have things that we move forward on and mental health in a broader vision is something that we have actually on our calendar. And in reference to your second question, Carol. [SPEAKER CHANGES] In reference to the broader issues, we specifically put a principle in there that we would suggest and encourage proposals that show programs that link behavioral health and mental health. It sounds like a basic idea, but it’s a relatively new idea for the last four or five years in the Medicaid world, that that linkage is so critically important that as you know very clearly that the impact of the anti-psychotic drugs are all physical side effects. So we need proposals that as we move forward with our process in that, the professionals at the Department of Mental Health will be involved in helping us look at that. What we don’t want to do is build a long-term strategy. Medicaid is a financing agency so we want to make sure that we…

we're looking at opportunities for our sister agencies to provide their services, again, in a comprehensive, patient-centered community based way. So they'll be involved in the development of our proposal as we get these, and I've talked to several mental health experts int he communities and they all have told me they're going to submit proposals. [SPEAKER CHANGES] Follow-up. [SPEAKER CHANGES] Yes, follow-up. [SPEAKER CHANGES] On the cap money, my understanding was that, I don't know, is that totally state money that was used discretionarily and it was capped at so many patients? [SPEAKER CHANGES] I will have to seek guidance on that question. Carol or Steve? [SPEAKER CHANGES] This is Kelly Crosby from the Division of Medical Assistance again. I'm not sure I, I want to be able to answer your question but do you mean the cap IDD waiver funding? And were you asking would the cap IDD waiver funding go to support the I option, is that what you were asking? I think, probably, in order to tell you how much there is it would be best just to go back and get you some actual real numbers. [SPEAKER CHANGES] And Senator, we can get that to you also. [SPEAKER CHANGES] Senator Barringer. [SPEAKER CHANGES] Thank you, Madam Chair. I'd just like to make a comment. I feel very strongly, as they do, about mental health and also addiction that go hand in hand. My husband and I were foster parents for ten years and the numbers that you shared with us today about the 176,000 children abused, we had children in our home that had been life flighted into Chapel Hill. What I would like to highlight to you is that the results of the mental health crisis we have today and the addiction, much of it starts in those early years with children who cannot speak for themselves. So I do commend you to be watchdogs and just be aggressive in looking after those children who cannot speak for themselves because we are now paying the price for all the things that have happened in the past to those children and they're our responsibility. [SPEAKER CHANGES] Senator, thank you. As a mother, a physician, and the Secretary of Health and Human Services I can assure you that these issues are near and dear to our heart and this is what we do every single day and I pledge to you, in the name of the staff, that we will continue to do that to the best of our abilities. [SPEAKER CHANGES] Representative Ford. [SPEAKER CHANGES] Thank you. Good job, Madam Secretary, thank you for the job you're doing. I have a question on the 176,000 child abuse reports, I know you have to investigate all of them. Is that a substantiated number? Are those substantiated reports? [SPEAKER CHANGES] No sir. [SPEAKER CHANGES] Okay, do you know that number? [SPEAKER CHANGES] Let's see, Cheri, would you be kind enough to pull that through your files. We may get that number to you right away if we look on the right page, sir. [SPEAKER CHANGES] Thank you. [SPEAKER CHANGES] Cheri will be able to get that answer? Yes? Sir, we will get that back to you as soon as we get to the office. [SPEAKER CHANGES] Okay, are there any other questions from Dr. Fulghum? [SPEAKER CHANGES] Thank you, Secretary Wos. We have been in the midst of struggling with this Medicaid expansion. You would be the recipient of that decision, obviously, if we decided to do something of that type. You mentioned earlier that we cannot sustain the current Medicaid program as currently functioning and I assume that that would include adding 500,000 new Medicaid eligibles onto an already dysfunctional program. That's our struggle. And given the fact that we heard yesterday, and in other hearings, that this is not a requirement that we do that this year or next year or even the next year after that in regards to expanding this eligible group. So would you agree that prudent behavior would be the way for you to come and say, "Now we're ready, now we're able, with the staff, the programs, and the IT development to accept even more responsibility of Medicaid eligibles." That seems to be the way we're headed. Is that a reasonable assumption on our part?

Well, sir, the decision with the legislature, the administration has been made in reference to priorities of Medicaid reform prior to any other decisions. With the Affordable Care Act as it stands, we're not making preparations to absorb into the Medicaid fold an addition of the folks called the 'woodwork effect'. That is something that is mandated by the Affordable Care Act, and is one of the reasons why we're in such a hurry with Medicaid reform inside of our department in order to prepare us to be able to accomodate that. The sums of money that will be necessary for the state to absorb the folks which we'll refer to as this 'woodwork effect' is something that we will be presenting to you in our budget as we present it to the Governor within the next few days and it will be presented to you, but please be aware of the fact that inside of the Affordable Care Act, we will have, as is presently, mandates to absorb more people inside of our Medicaid system. I hope that answers your question, what we're facing now, and I think that we absolutely need to get this reform right. If we get this reform, it may not be perfect, probably won't be perfect, but if we can get it in a much better place than we are right now, we will have far more flexibility, even intellectually, to evaluate the additional needs in our society. [SPEAKER CHANGES] Do you have a follow-up? [SPEAKER CHANGES] I assume that the answer is waiting for a load on your workload as far as taking care of these additional eligibles may be the prudent thing to do, until we see that the system is improved. [SPEAKER CHANGES] That's correct, sir. [SPEAKER CHANGES] Thank you. [SPEAKER CHANGES] Are there any other further questions from committee members? Comments? Senator Pate has asked for some closing remarks. [SPEAKER CHANGES] And I'll be very short. Madame Secretary, I feel the rustle of Spring and it's wafting down from Dick's Hill all across Raleigh, and I congratulate you and welcome you to H.H.S. in your position. [SPEAKER CHANGES] Well, at this time, then, do you have any closing remarks Secretary Vosh[SPEAKER CHANGES] Madame Chair, if I may, just take this opportunity, I apologize, I have to do it and did not do this in the beginning, I would like...also new members to the staff, that perhaps you do not know to please be kind enough to introduce themselves, Adam and Christy, if you could please introduce yourself. Christy if you just want to identify yourself and share with us who you are. [SPEAKER CHANGES] Hello, my name is Christy Craig, and I'm currently serving as the Executive Assistant to Secretary Vosh. [SPEAKER CHANGES ] Thank you, Christy, and Adam? [SPEAKER CHANGES] Thank you Madame Secretary and Madame Chair...members...my names Adam Scheller I'm the new legislative liaison for H.H.S. I look forward to working with everyone. [SPEAKER CHANGES] And thank you very much on behalf of the staff at H.H.S. and thank you very much for inviting us here today. We look forward to working with you. [SPEAKER CHANGES] Thank you, at this time there is no further business to come before the committee and we are adjourned. Thank you.