SB 808 – Medicaid Transformation Necessities

SB 808 – Medicaid Transformation Necessities

Primary Sponsors: Sen. Harry Brown (R-Onslow), Sen. Kathy Harrington (R-Gaston), Sen. Brent Jackson (R-Sampson)


Delay Implementation

  • This bill would require Medicaid Transformation implementation by January 1, 2021.


  • This bill would appropriate funds to the operation of the NC Medicaid program. No set amounts are listed in this bill as of 5/19/2020. (*This is consistent with the other Senate appropriation bills.)

Use of Medicaid Transformation Fund 

  • The bill appropriates a non-recurring amount for Medicaid Transformation needs in the 2020-21 fiscal year. No set amounts are listed in this bill as of 5/19/2020.
  • The bill appropriates a non-recurring amount to the Division of Health Benefits as needed for the purpose of paying claims to services billed under fee for service. No set amounts are listed in this bill as of 5/19/2020.
  • The bill appropriates nonrecurring funds as needed, and not a lump sum to the Division of Health Benefits for qualifying needs relating to transformation including program design, beneficiary experience, NC FAST upgrades, data management, program integrity, and technical operations.
  • The bill requires the Office of State Budget and Management to oversee the funding use and ensure any requested amount does not exceed $140 million.


  • The bill repeals the past directive to eliminate GME to align with Medicaid Transformation.

Medicaid Transformation Hotline

  • The bill requires DHHS to ensure that the existing DHHS customer service hotline is responsive to questions posed by a Medicaid beneficiary, provider, or the general public.

Tribal Option

  • The bill creates a new option for DHHS to contract with an Indian managed care entity or Indian Health care provider to assist in services to federally recognized tribes.

Revise Supplemental Payments

  • The bill states that the program shall no longer utilize a limit on the number of eligible medical providers that may be reimbursed the program and instead shall limit the total payments made under the program.
  • The bill requires payments to increase reimbursement to the average commercial rate under the State Health Plan and direct that payments increase to the average commercial rate under the managed care system.
  • The bill creates a roll out period for creating this new system.

Medicaid Contingency Reserve

  • The bill creates a Medicaid reserve to be used for budget shortfalls.

Revise Hospital Assessments

  • The bill gives authority to NC DHHS to adjust the hospital assessment payment amounts between October 2020 and December 2020.
  • The bill exempts certain types of hospitals from the supplemental assessment and base assessment.

Gross Premiums/Prepaid Health Plans

  • The bill states that the tax in this section shall be measured by the gross capitation payments received by the prepaid health plan from DHHS for services provided to enrollees in the Medicaid program.
  • The bill states that capitation payments refunded by a prepaid health plan to the State are the only allowable deductions.
  • The set tax rate to be applied to gross premiums is 1.9%.

Hospital Uncompensated Care Fund

  • The bill creates a special fund consisting of federal adjustment receipts arising from certified public expenditures.
  • The funding could be used for payments to institutions for mental diseases and payments to hospitals to reimburse inpatient services, uncompensated care costs, or outpatient services.


Filed – 5/19/2020


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