North Carolina Legislative Report - February 28, 2014

The General Assembly has officially completed its business for the 2013 long session.  The 2014 short session will begin on Wednesday, May 14, 2014.  The MVA Public Affairs Legislative Report on North Carolina will be distributed bi-weekly to keep you up to date on the latest legislative issues facing the state during the interim.

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2014 CANDIDATE FILINGS

North Carolina’s 2014 campaign season officially opened Monday, February 10. The filing period will end today, February 28. The North Carolina Board of Elections’ most recent list of candidates can be found here. (PDF)

Committee Reports

Revenue Laws Study Committee

The Environmental Review Commission met on Monday, February 17.  The Commission’s meeting was dedicated to the discussion of two recent spills into the State’s waterways, the responses by the Department of Environment and Natural Resources to those two spills, the responses of the parties responsible for those spills, and ongoing mitigation and remediation efforts. 

• A release of untreated sewage from the East Burlington Wastewater Treatment Plant into the Haw River began during the evening of January 27.  Over the course of just over 45 hours, approximately 3.5 million gallons of untreated sewage fluids were released into the river after a force main at the treatment plant failed.  Initial efforts to stop the spill were hampered by extreme cold faced by the State on January 28.  Based on erroneous advice from DENR, the City of Burlington failed to provide timely notice of the spill to the public.  To date, no negative impacts have been noted from the spill – there were no reported fish kills and no danger to public water supplies
• Beginning at approximately 2 p.m. on February 2, coal ash began spilling into the Dan River through a ruptured storm-water pipe under a containment pond at the Duke Energy Dan River Station.  The spill continued from the main pipe for a period of five days, releasing as much as 35 million gallons of coal ash and associated water into the river.  Initial monitoring of the river showed elevated levels of several heavy metals, but those levels had begun to decrease back to normal levels within days.  Initial reports indicated no threat to public drinking water supplies downstream from the spill.  The State and Duke Energy have been monitoring water quality levels downstream from the plant and have begun work on a plan for remediation.  Numerous representatives of environmental groups urged the State to take action with respect to cleaning up remaining coal ash ponds at other sites throughout the State.

Committee on Market Based Solutions and Elimination of Anti-Competitive Practices in Health Care

The Committee on Market Based Solutions and Elimination of Anti-Competitive Practices in Health Care met on Tuesday, February 18. The Committee began by hearing a report on changes to the certificate of need (CON) law enacted in 2005 that removed some restrictions on gastro-intestinal procedure rooms.  Peter Donaldson with Digestive Health Specialists reported that the changes had saved an estimated $300 million in health care costs since 2005.  He recommended that the legislature look at removing restrictions on other types of single-specialty ambulatory surgical centers.  Cody Hand with the North Carolina Hospital Association presented next.  He stated that the NCHA is not opposed to all reform efforts, but noted that CON laws are still needed.  He stated that hospitals provide additional community benefits in that they are always open and they serve the needs of the entire community.  He stated that one must consider several issues when considering changes to the CON laws such as 1) hospitals rely on cross-subsidization so that some services help offset costs associated with other services provided to the community, 2) self-referral to doctor-owned ASCs may result in unnecessary procedures, 3) there has been no demonstrated difference in quality of care provided at ASCs, and 4) greater use of ASCs may cause some doctors to drop hospital admitting privileges, which could result in less specialists being on call to deal with emergency situations at hospitals.  Next, David French with Strategic Healthcare Consultants presented on issues related to the provision of charity care in ASCs and argued that loosening restrictions on ASCs could result in more charity care being performed.  Finally, representatives of the Department of Health and Human Services and the North Carolina Medical Society provided information on the differences between operating rooms (which must go through the CON process) and procedure rooms (which are not required to go through the CON process) and how the elimination of a clear distinction between the two types of rooms has complicated the CON process.

House Committee on Education Innovation

The House Committee on Education Innovation held its third meeting of the interim on Wednesday, February 19.  The meeting kicked off with a presentation by Dr. Scott Rails, President of the NC Community College System on innovative ideas in the technology, academic and economic/financial arenas.  Dr. Alisa Chapman with the UNC General Administration followed with a presentation on teacher preparation and support efforts, highlighting the success of various entry portals and programs in the K-12 system.  The Committee hearing wrapped up with a panel discussion with 2012-2013 regional teachers of the year.  The Committee will meet again on Wednesday, March 19. 

Joint Legislative Oversight Committee on HHS, Subcommittee on Mental Health

The Health and Human Services Subcommittee on Mental Health met on Monday, February 24 to discuss crisis prevention/intervention services, psychiatric bed capacity, and alcohol and drug addiction treatment.  The meeting began with an overview of national trends in mental health management by Dr. Marvin Swartz with Duke University and David Swann with Partners Behavioral Health Management.  They were followed by presentations on public versus private roles, resources and responsibilities in mental health by David Richards with DHHS and representatives from private sector providers.  Next, DHHS and private providers discussed crisis prevention and intervention.  DHHS and private providers gave overviews from their respective positions and discuss ideas for improvement.  The meeting ended with presentations on psychiatric bed capacity and alcohol and drug addiction treatment.  The Committee will meet again on Friday, March 7.

North Carolina Educator Effectiveness and Compensation Task Force

The North Carolina Educator Effectiveness and Compensation Task Force kicked off its work for the 2013-2014 interim on Tuesday, February 25.  The task force will discuss and make recommendations on how to identify and reward effective teachers in North Carolina.  The Committee is comprised of legislators, parents, education experts and representatives from teaching groups.   In its first meeting, the Committee covered its charge, the current teacher compensation structure, and heard from local school administration units on strategic staffing and pay for performance plans.  The Committee plans to make its recommendations to the General Assembly by mid-April. 

Medicaid Reform Advisory Group

The Medicaid Reform Advisory Group met on Wednesday, February 26 to hear a report from the Department of Health and Human Services with respect to their efforts to date to develop a proposal for Medicaid system reform.  The Department presented the five following recommendations as part of their plan for reform:

• North Carolina Medicaid services for physical health will be coordinated through accountable care organizations (ACOs) that share savings and losses with the state and are responsible for quality.  ACOs will begin in July 2015.  The risk of loss borne by ACOs will be mitigated at the outset.  ACOs will proceed along a pathway of increasing risk assumption over time.  The Division of Medical Assistance (DMA) will need approval of a state plan amendment and possibly a program waiver from the Centers for Medicare and Medicaid Services (CMS), the federal entity responsible for oversight of state Medicaid programs, before proceeding.
• ACOs’ coverage of the population and financial responsibility will rise progressively. By July 2018, ACOs will be expected to cover at least 80% of the state’s Medicaid population.  By July 2018, ACOs will have accepted the major share of financial risk for costs incurred by Medicaid beneficiaries and will continue along a pathway for full risk
• DMA will work to enhance the state's Medicaid mental health, substance abuse, and intellectual/developmental disability service delivery system.  This will include the consolidation of the 11 existing LME-MCOs (local management entity – managed care organizations), the entities responsible for providing these services, into four strong entities.  DMA will 1) continue to enhance performance measures and add financial penalties and incentives for the LME-MCOs, 2) standardize processes across all LME-MCOs in the state, 3) intensify monitoring and technical assistance aimed at system improvement, 4) work to integrate care between LME-MCOs and ACOs, and 5) explore ways to reduce the waiting list for waiver services to increase access to care.
• DMA will work to streamline and strengthen case management for long term services and supports (LTSS).  By July 2015, DMA will institute uniform, holistic needs assessments and care planning for beneficiaries requiring LTSS.  Needs assessment and care planning will be followed by case management at an appropriate level for each client, with a focus on transitions between care settings.
• DMA will continue the strategic planning process around the long-range design of the LTSS service delivery system.

The Department will incorporate comments received during the meeting into a more formal document and will present this plan to the Medicaid Reform Advisory Group next month.