August 18, 2021

House and Senate Pass State Budget Bills

There was a moment in this Long Session of the NC General Assembly when it appeared there may not be a budget passed for the biennium of State fiscal years 2021-2022 and 2022-2023.  But the Senate did finally present and quickly pass their proposed budget in late June and the House took some time before publishing their version on August 9th.  Once the House and Senate negotiate their differences and pass a final version of the budget, it will be sent to the Governor.  Leaders of the House and Senate have already stated that it will not include expansion of Medicaid coverage to narrow the gap of coverage for those who are uninsured or underinsured.  As many recall from the 2019 budget impasse, this is a very important issue to the Governor.  This is one reason why it is difficult to predict if the Governor will sign the budget bill when it is sent to him or even possibly veto the budget bill.  He has the options to:

Medicaid expansion was not a part of either the Senate or House proposal.  But they did include provisions that would extend Medicaid eligibility for specific populations. 

Of course, the beginning of the fiscal year on July 1 has already come and gone.  State government agencies are operating based on the funding levels from the previous budget.  Below are additional provisions related to MH/IDD/SUD services that are included in either the House or Senate budget proposals or are included in both proposals.  When both proposals include the same provision, it is not in contention and is generally expected to be a part of the final proposal. 

Senate or House version of budget? Provision
Senate HouseMedicaid Transformation funding transferred from the General Fund to the Medicaid Transformation Reserve.  Funding levels are different in Senate and House versions. 
Senate HouseIncrease funds per child with disabilities in school
HouseFunds to engage a consultant (already named) to make recommendations on how to categorize and set tiered funding levels for the allocations related to students with disabilities
SenateFunds a two-year pilot program at two community college campuses for training programs that provide opportunities for a micro-credential or other credentials that lead to increased employment outcomes for individuals with intellectual and developmental disabilities (IDD).
HouseEstablishes a plan for School Threat Assessment Teams
Senate HouseFunds school safety grants program that includes grants for students in crisis, grants for training to increase school safety.  $10 million for both fiscal years non-recurring.
HouseEstablishes the COVID-19 ADM and Children with Disabilities Reserve with $40 million non-recurring when enrollment exceeds expected number of students. 
SenateEstablishes the K-12 ADM Fund when administrative costs exceed expected amounts and does not specify funding for children with disabilities with $22 million non-recurring. 
Senate$15 million for contracted school health services.  Public school units receiving the funds shall contract with school health support personnel to provide additional physical and mental health support services for students in response to COVID-19.
SenateEstablishes the NC Personal Education Student Accounts for Children with Disabilities Program.  $9.65 million recurring is appropriated. 
SenatePermit the use of the Special State Reserve Fund for transportation and to establish the Transportation Reserve Fund for homeless and foster children.
HouseNC DHHS required to submit a proposal to add Medicaid Coverage for Transportation provided by public school units to the legislature by 3/1/22
HousePaid parental leave for public school employees to care for newborn child (8 weeks) or newly placed adopted, foster, or otherwise legally placed child under the age of 18 (4 weeks). 
HouseFunds for rapid rehousing, home improvements, and home repairs for individuals and families at risk of homelessness, $15 million non-recurring. 
Senate HouseNCFAST maintenance and upgrade for Medicaid Transformation and deployment of the case management function. 
Senate HouseExpand Innovations Waiver slots by 1,000 over the next two State fiscal years.  The House also included a provision that requires recommendations by 3/1/22 for how slots can be increased in the next biennium. 
HouseCreates the Home and Community-Based Services (HCBS) Fund with $274.8 million funding saved from federal appropriations through the American Rescue Plan Act (ARPA).  The Fund can be used to increase the number of waiver slots in the Innovations and CAP waivers. 
Senate HouseExtends Medicaid eligibility for parents of children who have lost custody of their children and the child is in the foster care system 
Senate HouseIncrease the pay rate of certain direct support workers to $15.00 /hour to begin on July 1, 2022.  $17.5 million recurring is appropriated beginning on 7/1/22. 
Senate HouseAllow LME/MCOs operating as BH/IDD Tailored Plans to choose a national accreditation.
Senate HouseEvaluate the NC Division of Health Benefits staffing needs for Medicaid managed care.
HouseIncludes several telehealth provisions including:  improving access to care through telehealth language, $10 million non-recurring for a virtual behavioral health services grant program, and $1 million non-recurring to Atrium Health for a school-based virtual care pilot program to address health disparities in historically underserved areas disproportionately impacted by COVID-19.  
Senate HouseAllow for Medicaid reimbursement of services provided in charter schools
HouseExtends for the final time the temporarily increased Medicaid reimbursement rates for certain providers until 11/30/21
HouseRequire LME/MCOs to pay for behavioral health services provided to Medicaid beneficiaries awaiting hospital discharge. 
Senate HouseOpioid settlement funds (does not specify funding for children and youth). 
SenateAuthorizes the transfer of $30 million recurring to single stream funding to replace cuts in previous years.  Single stream funding (for State-funded services) now totals $301.4 million. 
HouseAuthorizes the transfer of up to $30 million to single stream funding if there is a certified surplus in Medicaid. 
Senate3-way (DHHS, LME/MCO, hospital) inpatient psychiatric beds studies due on 12/1/22 and 12/1/23.
Senate HouseFunding for new licensed behavioral health beds in certain rural hospitals.  Funding is from the sale of Dorothea Dix property. 
SenateAuthorizes a two-year behavioral health urgent care pilot program at the Dix Crisis Intervention Center in Onslow County to be contracted through Trillium Health Resources and RI International.  $500,000 non-recurring in SFY21-22 and $1,500,000 in SFY22-23 non-recurring is appropriated.  A behavioral health urgent care service definition will be developed and piloted for formal implementation as a State-funded and Medicaid service definition. 
SenateAdds behavioral health urgent care, cleans up list of behavioral health services covered by PHPs.
Senate HouseTwo provisions for short-term funding for group homes and ICF-I/DDs.  $1.8 million non-recurring for both years of the biennium for group homes.  State Fiscal Recovery Funds are used for the short-term funding for ICF-I/DDs. 
HouseTemporary additional funding assistance for ICF-IDD facilities, $12.6 M non-recurring.
HouseGroup Home Stabilization and Transition Initiative, $15 M recurring. 
HouseAdditional funding for Mecklenburg and Forsyth counties crisis behavioral health partnership with local providers, $25 M non-recurring
HouseStudy the shortage of psychiatrists at State-operated facilities and provide report no later than 4/1/22
Senate HouseChild Welfare Post-Secondary Support Program (NC Reach) funding to be used to continue providing assistance with the “cost of attendance” as that term is defined in 20 U.S.C. ยง 1087ll for the educational needs of foster youth aging out of the foster care system, youth who exit foster care to a permanent home through the Guardianship Assistance Program (GAP), or special needs children adopted from foster care after age 12. 
Senate HouseAuthorization to continue the Successful Transition/Foster Care Youth Initiative.  The Foster Care Transitional Living Initiative Fund will continue to fund and support transitional living services that demonstrate positive outcomes for youth, attract significant private sector funding, and lead to the development of evidence-based programs to serve the at-risk population.
Senate HouseProvides funding for the Permanency Innovation Initiative to improve permanency outcomes for children living in foster care settings. The special provision limits administrative funds.  $2 million recurring for both years of the biennium. 
HouseIntensive Family Preservation Services funding, performance enhancements and report
House$320,000 non-recurring to SaySo for SFY22.
Senate HouseIncrease foster care rates starting on 10/1/21.
SenateAuthorizing a child welfare/BH pilot project.  The purpose of the pilot project is to establish a trauma-informed integrated health foster care model to facilitate partnerships between county departments of social services and local management entities/managed care organizations (LME/MCOs) regarding children placed in foster care. $300,000 non-recurring is appropriated for SFY21-22.
Senate HouseFull implementation of seven regional offices (in the 7 Standard Plan regions) by March 1, 2024 for further regionalization of DSS with offices in the seven regions.
Senate HouseFunding for the Transition to Community Living Initiative to expand the number of individuals transitioning into housing slots, increases the number of referrals to supported employment, and serves more individuals in Assertive Community Treatment (ACT).n
HouseTANF/Work First Families to receive two payments to provide financial assistance needed due to COVID-19, $16.7 M non-recurring.
HouseAppropriation of federal block grant funds for DHHS under the American Rescue Plan Act (ARPA)
Senate HouseProvides funding for the Juvenile Justice section to expand wraparound services for youth who are transitioning from Youth Development Centers into their communities. Funds will expand capacity and necessary services to address the increase in youth detention following the passage of S.L. 2017-57 (Raise the Age) legislation during the COVID-19 pandemic.
SenateUpdating language to designate drug treatment courts as Accountability and Recovery Courts.
SenateCreation of Division of Prisons replaces Division of Adult Corrections and Juvenile Justice and refers to Department of Adult Corrections.
HouseCreation of Division of Adult Corrections of the Department of Public Safety.
Senate HouseCreation of Division of Juvenile Justice of the Department of Public Safety.
HouseCreation of a NC Council for Women and Youth Involvement to advise the Governor and administration on issues such as domestic violence and child fatality. 
Senate HouseTransformation Pilots and Projects:  Provides funds to support the transition to Medicaid managed care and the Healthy Opportunities pilot program. The State share of costs, $133.1 million in FY 2021-22 and $119.0 million in FY 2022-23, will be transferred from the Medicaid Transformation Fund.
HouseSeveral provisions to expand broadband access by providing grants to counties to expand.