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Medicaid expansion bill glides through committees in state House of Representatives

Advocates in legislature face less opposition; attention now focused on Senate


RALEIGH — Legislative committee hearings often are sleepy affairs, attended by lawmakers, lobbyists and the occasional person interested in the intricacies of government.

That was not the case last week on the sixth floor of the legislative office building. The size and excitement of the crowd looked more like someone had a small stash of Taylor Swift tickets or the hottest new iPhone for sale.

Lobbyists and advocates of expanding the state’s Medicaid program were jammed into a hallway, hoping to get inside the room where something, after more than a decade of waiting, might start to happen.

State House committees were set to discuss House Bill 76, which could create a pathway for hundreds of thousands of low-income North Carolinians to receive health coverage. The potential recipients are largely low-income workers who earn too much to qualify for the program as it is currently structured. But if North Carolina pulled down federal funding that other states do, they could qualify and be added to the Medicaid rolls.

The program, as is, mostly covers children from families with low incomes, some of their parents, some people with disabilities and seniors with limited financial means. For many low-income workers, health insurance can be out of reach because they earn too little to qualify for subsidies available through the federal health insurance online marketplace.

Rep. Donny Lambeth, a Republican from Winston-Salem who is the primary sponsor of the bill, said it’s time for North Carolina to get off the list of 12 states that have not adopted Medicaid expansion. The issue has been a political flashpoint in North Carolina since the Republican-led General Assembly voted in 2013 to reject the portion of President Barack Obama’s hallmark Affordable Care Act that makes expansion possible.

“North Carolina would become the 39th state,” Lambeth told the House Health Committee last Tuesday morning. “We’ve learned from other states, we had hearings in this room that brought in a number of other states.”

Lambeth argued that since North Carolina moved the Medicaid program to a managed-care regimen in 2021, there is more budget predictability and efficiency than when Medicaid was operated as a fee-for-service program.

“We have a good system now,” Lambeth said. “It’s been working for a while.”

After just 18 minutes, with little discussion, the bill passed the health committee with only a handful of opposing votes. A similar scene unfolded in a House finance committee in the afternoon, where the entire discussion took less than 15 minutes, with no opposing votes.

Medicaid expansion — after a 10-year wait — seems to be breezing through the state House of Representatives.

The biggest challenge now will be getting the state Senate on board.

No work requirement

Lambeth and another primary sponsor, Rep. Donna White, R-Clayton, had been at the forefront of other Republican-generated bills to expand Medicaid in the 2019 and 2021 sessions. There’s a noticeable difference in the latest rendition, which drew broad interest in the committee meetings last week. There is no proposed work requirement for new program beneficiaries.

That had been a caveat that most Republican-led states tried to enact in conjunction with expansion programs. Federal judges have generally blocked states from creating work requirements for Medicaid, but one Georgia judge ruled that the Biden administration's rejection of that state's work requirement plan was an overreach, clearing the way for Georgia to enact such a requirement.

The federal legislation that created Medicaid in 1965 defines the program as an entitlement open to everyone who falls in the coverage category.

During the Trump administration, the federal Centers for Medicare and Medicaid Services moved to approve states’ requests for adding work requirements, but the Biden administration has generally frowned on such efforts.

Advocates have long argued that most of the people who would gain Medicaid coverage under expansion are already working. They have held up people like child-care workers, farmers, ministers and others who earn lower wages in companies and jobs that don’t provide health benefits as the primary beneficiaries. The bill would include people earning as much as 133% of the federal poverty level, which translates to $19,391 a year for an individual or $33,064 for a family of three.

“Most of these people who will qualify are actually working,” Lambeth said. “They just can’t afford health care.”

For others who are not working, House Bill 76 would require the state Department of Commerce to collaborate with the state Department of Health and Human Services to “create a seamless, statewide, comprehensive workforce development program” that will be known as NC Health Works.

“I bet you hear that every day in your district that people, employers, small businesses can’t get enough workers,” Lambeth said. “We do need to figure out the magic behind helping individuals who actually would qualify for this program, potentially improve theirselves.”

The initiative put forward by Lambeth duplicates the strategy taken by Montana when it expanded Medicaid. Lambeth said members of a North Carolina Medicaid study committee that met last year “really liked” that model. The Montana program helped match its new Medicaid recipients who were unemployed with job training and employment opportunities. That excluded students, caregivers, disabled people or beneficiaries in drug treatment programs.

In Montana, about 13,000 people participated in that state’s job program, and 72% got a job once they finished employment training, according to a report generated by the Montana Department of Labor and Industry. Health care professions accounted for seven of the top 10 jobs that people in the training program pursued, according to one finding.

Hospitals give, get

One stumbling block over the past decade for expansion was the question of who would pick up the tab for the additional recipients. The Affordable Care Act stipulates that the federal government would pick up 90% of the cost for the new beneficiaries, while states need to cover the other 10%.

Estimates for the North Carolina portion of the coverage range from $224 million in the first year to about $700 million by the fourth year.

One section of House Bill 76 would change the way hospitals get paid by the federal government for caring for Medicaid patients. The legislation would use the federal Healthcare Access and Stabilization Program, which is administered by the Centers for Medicare and Medicaid Services and reimburses hospitals at a rate closer to the actual cost of care. State health officials say the program would bump up reimbursement for hospitals across the state by about $3 billion per year. But in exchange for North Carolina enacting the program, hospitals would foot the bill for the extra beneficiaries.

Hospitals have long complained that they were already footing the bill for uninsured patients who show up at their doors. Many hospital representatives say health care facilities are now willing to pick up the state’s share — as long as the stabilization program is enacted.

“In 2021, Novant Health provided over $727 million in unpaid Medicare coverage and over $111 million in Medicaid coverage to patients,” a Novant Health spokesperson said in an email to NC Health News. “We support the passing of the Healthcare Access and Stabilization Program (HASP) to ensure hospitals have the financial fortitude to care for Medicaid patients.”

‘Counting on you’

Among health care lobbyists and advocates, the excitement over the House bill was palpable last week. Many advocates wore red for Valentine’s Day, accessorizing their outfits with stickers picturing a large red heart and reading, “Love thy neighbor. Expand Medicaid!”

Abby Emanuelson, head of Care4Carolina, said that while the bill only received about a half hour’s worth of discussion — total — in the two hearings, Tuesday’s outcome was the result of “numerous years” of work and “lots of Zoom minutes.”

“Coalitions have been talking to these members, really getting a lot of good conversations going. And, of course, as we heard from Rep. Lambeth today, he’s been talking to his colleagues for a number of years as well about this,” Emanuelson said.

For the past decade, the North Carolina Chamber of Commerce has declined to take a position on Medicaid expansion. This year, a number of other politically conservative and business-friendly groups have endorsed the policy, Emanuelson noted. She said that includes local chambers of commerce from metro areas and rural counties and multiple boards of county commissioners.

Advocates handed out Valentine’s Day cards hand-colored by Medicaid expansion supporters from around the state.

Erica Palmer Smith, who preceded Emanuelson at Care4Carolina, pointed out that other states that have expanded have seen economic benefit.

“Studies have shown that states increase jobs whenever they pass Medicaid expansion,” said Palmer Smith, who now leads the advocacy group NC Child. “Louisiana saw an additional 18,000 jobs, Colorado saw an additional 30,000 jobs.

“I think this is going to be a tremendous benefit for all of those local economies, for their small businesses, for the employees themselves,” Palmer Smith added.

The biggest challenge to enacting House Bill 76 lies on the other side of the legislative building. While the Senate overwhelmingly passed Medicaid expansion last year, its bill included measures to overhaul the state’s laws limiting hospital competition and also included measures to loosen restrictions on advanced practice nurses, such as nurse practitioners and nurse anesthetists. That bill never had a hearing in the House.

“The title is ‘Access to Care,’ yet it doesn’t do anything to increase access in terms of facilities or personnel,” Senate leader Phil Berger told reporters recently about this year’s bill. “It’s not the bill we need in North Carolina expanding Medicaid.”

Lambeth said it was a coincidence that last week’s committee votes occurred on Valentine’s Day. Nonetheless, he shared with his colleagues a holiday rhyme sent to him by a constituent.

“‘Roses are red, violets are blue, our neighbors need affordable health care, and that’s counting on you,’” Lambeth read. “That pretty much says it all.”

This article first appeared on the North Carolina Health News website and is republished here under a Creative Commons license.

North Carolina Health News is an independent, nonpartisan, not-for-profit statewide news organization dedicated to covering all things health care in North Carolina. Visit the North Carolina Health News website.

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General Assembly, politics, health care, Medicaid