State Rep. Josh Dobson tried — tried — tried to keep this quiet until the committee hearing tomorrow. (He REALLY tried.)
Soooooooooooo — Doing NOTHING, like the bought-and-paid for lynch mob wants to do would cost the state (and, of course, US) up to $86 million through 2020 and up to $241 million by the end of 2022.
[…] House Bill 184 (First Edition) creates a study committee to recommend a design for the State Health Plan (Plan) and submit its final report no later than April 1, 2020. The bill also requires the Plan to continue to use the Blue Cross Blue Shield of North Carolina Blue Options provider network and to reimburse participating network providers in accordance with 100% of the applicable fee schedule through December 31, 2021. This requirement does not apply to the Medicare Advantage plans.
The State Treasurer has announced his intention to move the Plan to a reference-based pricing approach effective January 2020 that would tie most medical provider prices to a multiple of the prices set by Medicare for the same services.
The Segal Company, the actuary for the Plan, and Hartman & Associates, the actuary for the General Assembly, estimate that the bill will increase the Plan’s claims expenses by the following amounts by preventing the reference-based pricing approach until at least 2022:
The Segal Company
Hartman & Associates
Both actuaries relied on the Plan’s estimated claims savings and did not attempt to duplicate the savings calculation. Both actuaries’ estimates reflect the adjustment in the proposed rates announced on March 13, 2019 to an average of 182% of Medicare prices.
The bill would also impact the Other Post Employment Benefit (OPEB) liability of the State and related governmental units. The Segal Company states that if the bill passes, the ability to reflect the reference-based pricing approach in the June 30, 2019 valuation would be hampered and subject to auditor scrutiny. The Segal Company estimates that without reflecting the reference- based pricing approach, the Total OPEB Liability will increase by $1.1 billion and the Actuarially Determined Contribution (ADC) will increase by 0.4% of payroll, relative to the Liability and ADC reflecting the reference-based pricing approach.
Hartman & Associates estimates that the Total OPEB Liability calculated without the reference- based pricing approach would be roughly $1.0 billion higher than the Liability calculated with the reference-based pricing approach. Hartman & Associates estimates that the Total OPEB Liability would increase by $85 million if the Liability calculation assumes the reference-based pricing approach is implemented in 2022, but notes that we do not know what the committee will recommend and that the Liability is expected to be calculated without reflecting the reference- based pricing approach until a new model is implemented. […]
Sooooo — we, the taxpayers, are going to take on an additional HUNDREDS OF MILLIONS in additional expenses if this bill passes and Folwell’s hands get tied. If this bill gets passed and Follwell’s hands get tied, we’re on the hook for an additional $1.1 BILLION in liabilities when it comes to dealing with state retirees.
And THIS is a legislative move being spearheaded by the alleged party of fiscal conservatism.