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NC Department of Health and Human Services
NC Division of
Medical Assistance
 
 

Budget Initiatives

2011 Appropriations Act, SL 2011-145

DMA will implement a number of changes in response to legislated budget reductions mandated in SL 2011-145. Providers will be notified of operational changes and coverage and policy changes via the Medicaid Bulletin. These changes will also be listed on this web page.

Rate Reductions

Effective October1, 2011, to comply with SL 2011 - 145, section 10.37.(a) (6), DMA will be submitting State Plan Amendments to the Centers for Medicare and Medicaid Services to request a 2.67% rate reduction for North Carolina Medicaid service providers. Nursing Homes will have their rate reductions effective July 1, 2011. Beginning July 1, 2011 – ending September 30, 2011 Nursing Homes Facilities claims will systematically Recoup/Repay for rate reduction. If you have any questions, please call the DMA Finance Management Section at 919-855-4180.

Program Reductions/Service Limitations

Rebase –intended to adjust budget for environmental changes or external factors that will impact the next year’s base Medicaid expenditures. The rebase addresses 4 primary elements:
a) changes in enrolment (both in total numbers of recipients expected and shifts in program aid category),
b) inflation represents expected changes in expenditures from external mandates, cost based payers, nursing home case mix and prices set using external benchmarks,
c) consumption measures expected changes in utilization of services,
d) policy/new service measures the expected impact of normal policy changes and shifts in types of services utilized.

Rates - assumed a 2% rate reduction for all providers except FQHC/RHC’s, State institutions, hospital outpatient, pharmacies, State PH lab, non-inflationary component of NH CMI, ACH, LHD and CABHA’s, effective July 1, 2012.

Assessments - CMS allows States to establish assessments on certain providers, up to a maximum percentage of total non Medicare net patient revenue . Funds from these assessments can be used to enhance provider payments or be retained by the State. The SFY 2012 budget includes new assessments; with a State retain age for hospitals, CAP-MR and CABHA providers. There is an increased assessment for nursing homes and a newly retained amount from ICF-MR providers.

Health Home- Enhanced FMAP - The Affordable Care Act is incentivizing the development of Health or Medical Homes at a national level in an attempt to facilitate other states achieving the savings that North Carolina has through CCNC managing over 1,000,000 Medicaid enrollees.

Program Integrity - two components of PI third party recovery and provider recoupment this reduction item relates to the provider recoupment segment of PI:
This element of PI pertains to the process used to assure that payments are for documented appropriate/clinically justified services. DMA is employing increased analytic software, outsourcing to external experts and enhancing third party recovery efforts to ensure the appropriateness of Medicaid expenditures.
Maximum effectiveness of PI ensures that appropriations are utilized for those individuals that need them and not for services that are not clinically justified –should create an environment of self policing. Results in PI can mitigate the need for changes such as rate reductions to manage the Medicaid program within budget.

Service Modification - includes modifications to services that include pharmacy, optical, DME, specialized therapies, home health, dental and other services.

Pregnancy Home - includes the net impact of the new model for managing maternal and child care through CCNC implemented in April 2011. The program is designed to reduce C section rates, increase infant birth weight and coordinate care between physicians, care managers and local health departments –implementing best practice C-rates .

Behavioral Health Waiver - expansion of an existing waiver for behavior health services to 5additional service areas in SFY 2012 and the remainder of the State by 7/1/13. The waiver requires single capitated provider organizations for behavioral health services.

CCNC Savings - assumes that NC will continue to build on the success of the CCNC network of primary care physicians in managing the care of over 2/3rd of Medicaid recipients. SFY 2012 plan is based on an increased enrollment of ABD recipients, individuals in nursing homes/ICF-MR/ACH and the further integration of care protocols to enhance the quality of outcomes and lower the cost of care.

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2010 Appropriations Act, SL 2009-451

DMA will implement a number of changes in response to legislated budget reductions mandated in SL 2010-31. Providers will be notified of operational changes and coverage and policy changes via the Medicaid Bulletin. These changes will also be listed on this web page.

Rate Reductions

DMA has been instructed by the NC DHHS Secretary to reverse the proposed rate reductions that were effective September 1, 2010.  Notwithstanding any further directives, the rates in effect as of August 31, 2010 shall remain in effect on September 1, 2010, and thereafter.  DMA is in the process of replacing the published September 1, 2010, fees schedules with the previously published fee schedules.  The Fiscal Agent has been instructed to continue with the current rates on and after September 1, 2010.  If you have any questions, please call the DMA Finance Management Section at 919-855-4180.

Program Reductions/Service Limitations

  • Bariatric Surgery - Effective with date of service October 1, 2010, DMA will no longer cover surgery for clinically severe obesity. More information is available in the August 2010 and the September 2010 Medicaid bulletins.
  • Breast Surgery - The implementation of revised coverage criteria for breast surgeries has been delayed from October 1, 2010, to December 1, 2010.   Providers may continue to request prior approval for breast reduction surgery that is not related to reconstructive surgery as long as the procedure can be completed prior to December 1, 2010.   Additional information is available in the November 2010 Medicaid Bulletin.
  • Dental Services - Effective with date of serivce December 1, 2010, DMA will implement changes for the N.C. Dental Program. More information >>
  • Maternal Outreach Worker Program - Effective with date of service September 1, 2010, DMA no longer covers the Maternal Outreach Worker Program. More information >>
  • Panniculectomy - Effective with date of service October 1, 2010, DMA will no longer cover panniculectomy procedures. More information is available in the August 2010 and the September 2010 Medicaid bulletins.
  • Podiatry Services - Effective with date of service October 1, 2010, DMA will implement reductions and limitations for podiatry services. More information
  • Private Duty Nursing - DMA has been mandated to restructure the provision of PDN services. In preparation for these policy changes, DMA will hold three meetings to gather public comments. More on PDN stakeholder meetings >>

2009 Appropriations Act, SL 2009-451

DMA implemented a number of changes in response to legislated budget reductions mandated in SL 2009-451.

Rate Changes

Proposed amendments to the State Medicaid Plan related to rate reductions and changes in rate methodology are available on the State Plan web page.

Paperless Commerce

To meet the budget reductions mandated in SL 2009-451, DMA implemented new requirements for paperless commerce.

  • Electronic Claims:  DMA implemented a requirement for all providers to file claims electronically beginning October 2, 2009. More information on electronic claim submission
  • Electronic Payments: In September 2009, DMA discontinued issuance of paper checks for claims payments.  All payments are made electronically by automatic deposit to the account specified in the provider's Electronic Funds Transfer (EFT) Authorization Agreement for Automatic Deposits (PDF, 76 KB).  More information on electronic funds transfer
  • Automated Uniform Screening Program for Nursing Facility Admissions: All providers who are required to conduct a Preadmission Screening and Resident Review (PASRR) for individuals before admission to North Carolina's nursing facilities must use the automated Uniform Screening Program.  Additional information on the NC PASRR Online System application, helpful hints, and tutorials to assist you in registration and getting started using the NC PASRR Online System are available on the NC PASRR Home Page External link.

Program Reductions/Service Limitations

The N.C. Medicaid Program will implement reductions/limitations to some services in response to legislated budget reductions.

Case Management Services

To address the reduction in funds for Medicaid Case Management services, DMA will work with other DHHS Agencies to identify ways to improve the efficiency and effectiveness of case management services. More on case management service initiatives

Community Alternatives Program for Disabled Adults

DMA has been directed by the N.C. General Assembly to freeze slots in the Community Alternatives Program for Disabled Adults (CAP/DA) in order to meet the budget reduction goals for SFY 2010 and 2011. More on CAP/DA initiatives

Community Support Services

The Community Support Services Steering Committee will will meet on a regular basis to develop a plan in response to the State Legislature's provision to restructure community support services for both Medicaid and State-funded children and adolescents. More on community support service transition

Dental Services

Effective with date of service November 1, 2009, the N.C. Medicaid Dental Program implemented coverage and reimbursement changes to meet legislated budget reductions. More on dental services

Durable Medical Equipment

Effective November 15, 2009, DMA designated Prodigy Diabetes Care, LLC, as the preferred manufacturer for glucose meters, test strips, control solutions, lancets, lancing devices, and syringes. More on Prodigy diabetic supplies

HIV Case Management Services

On October 1, 2009, DMA implemented limits on the number of units that may be reimbursed each calendar month per recipient. More information on HIV case management services

MH/SA Residential Services

The Residential Planning Group will meet on a weekly basis to discuss a comprehensive plan in response to the State Legislature's provision to restructure Residential Services for both Medicaid and State-funded children and adolescents. More information on MH/SA residential service initiatives

Outpatient Pharmacy Services

Effective October 5, 2009, the reimbursement methodology for pharmacy claims changed from AWP-10% to WAC+7% and reimbursement for SMAC drugs changed from 150% of the lowest priced generic to 190% of the lowest priced generic. Effective December 1, 2009, N.C. Medicaid discontinued coverage of prescription medications that contain a cough suppressant or a cough expectorant. More on outpatient pharmacy services

Outpatient Specialized Therapies

DMA now requires prior authorization (PA) for outpatient specialized therapies (occupational therapy, physical therapy, speech therapy, respiratory therapy, and audiology services).  For recipients under 21 years of age, this requirement was effective with date of service December 1, 2009.  For recipients 21 years of age and older, this requirement was effective with date of service January 1, 2010.  DMA has contracted with the Carolinas Center for Medical Excellence (CCME) External link to perform the PA functions. More on prior authorization for outpatient specialized therapies

Personal Care Services

Independent assessment of personal care services (PCS) recipients was implemented on April 1, 2010. DMA has contracted with the Carolinas Center for Medical Excellence (CCME) External link to conduct the assessments. More on personal care services

Radiology Services

DMA now requires prior authorization (PA) for certain non-emergency, high-tech radiology procedures including CT, MR, PET scans, and ultrasounds.  DMA has contracted with MedSolutions to perform the PA functions for these procedures.  More on priror authorization for advanced imaging procedures