The legislatures’ drag-on session continued this week with many legislators absent, attending the American Legislative Exchange Council’s (ALEC) convention in Austin, Texas. The House held session Monday through Wednesday, while the Senate was only in town on Tuesday.

The House continues to place the motion to override Governor Cooper’s veto of the State Budget on the calendar every legislative day, but has still not taken a vote. 51 of the 55 House Democrats signed on to a letter last week, pledging that they will not vote to override Governor Cooper’s veto. This means that House leadership will have to wait until enough Democrats are not present to attempt an override, since they will not have the constitutionally required three-fifths vote if all 51 House Democrats vote no.

It was reported this week that the average cost of a day in session for the legislature is around $40,000 to $50,000, and it is estimated that the session has cost around a million dollars since the budget was vetoed. House Minority Leader Darren Jackson calls this a waste of money, since House and Senate leadership are not having discussions with the Governor on a compromise budget. However, Senate President Pro Tem Phil Berger released a series of unanswered text messages that he sent Governor Cooper, inviting him to discuss the budget. Berger claims that the unanswered text messages prove that it is Cooper who is stonewalling budget negotiations. Cooper claims that he has reached out through staff to negotiate.

The legislature has already approved a stop-gap funding bill to ensure that federal dollars can still be spent during the ongoing budget stalemate, and a 2015 law prevents a government shutdown by keeping in place the recurring funding levels of last year’s budget until a new one is adopted.

Birthing Center / PBM Bill

The House Health Committee stripped a Senate Bill dealing with regulations on mini-trucks this week in a maneuver called a Proposed Committee Substitute (PCS) to create a new two-part bill that deals with birthing center regulations and Pharmacy Benefits Managers (PBMs). The first section of Senate Bill 432 establishes a licensure process for birthing centers and creates the NC Birth Center Commission to promulgate rules around accreditation for birthing centers and care standards. The second part of the bill would place new regulations on PBMs, and prevent them from charging pharmacists certain fees, including shipping and handling. It would also allow pharmacists to refuse filling a prescription that they feel is not in the best interest of the patient. Both provisions of the bill have been pursued in other bills, but had not gotten the traction that the sponsors wanted.

NC DOT Layoffs

The North Carolina Department of Transportation (DOT) has announced that a cash flow shortage will force them to lay off around 1,000 temporary employees. The Department cited increased costs due to hurricane-related road repairs and slow federal reimbursements for road damage costs. In an average year, DOT spends around $65 million on storm damage road repair, however, this year they have spent nearly $300 million. DOT has also spent $311 million defending the controversial Map Act, which prevents landowners from developing property in areas where future highway projects are planned. The legislature repealed the Map Act earlier this year. Representative John Torbett, who chairs the House Transportation Committee, said that the legislature is exploring options to help alleviate the cash shortage. DOT noted that the current budget stalemate between Governor Cooper and the legislature is not a factor in the budget hole.

WRAL: https://www.wral.com/cash-crunch-forcing-dot-to-lay-off-hundreds-of-temp-workers-contractors/18568924/

News & Observer: https://www.newsobserver.com/news/local/article233969157.html

Healthy NC Bill Passes House

The House passed an omnibus healthcare bill this week and the bill will now go to the Senate for a concurrence vote. The bill has nine parts that do the following: creates a Psychology Interjurisdictional Compact (PSYPACT), allows licensed marriage and family therapists to perform first examinations for involuntary commitments, eliminates redundant adult care home inspections, creates the Lupus Advisory Council, requires that insurers develop formularies for Center for Medicare and Medicaid Services (CMS) approved step therapy, requires insurers to cover oral chemo drugs the same as injected chemo, requires Medicaid to pay for telemedicine, requires private insurance and the State Health Plan to cover telehealth services, and creates the North Carolina Healthcare Solutions Task Force. The bill was approved on a 106-3 vote, but it is unclear what provisions the Senate will agree to, as they have historically blocked similar provisions dealing with what they consider to be insurance mandates.

Folwell’s “Clear Pricing Project” Fails

State Treasurer Dale Folwell is abandoning his “Clear Pricing Project” which attempted to cut State Health Plan (SHP) reimbursement rates and fix them to a percentage of the Medicare rate, after his plan failed to build an adequate provider network with the hospital groups in the State. Hospitals across the State refused to join Folwell’s new reimbursement model, claiming that simple rate cuts and reference-based pricing models threaten access to care, and do nothing to ensure that quality care is delivered. The provider community favors a value-based approach that focuses on preventative care and patient outcomes to reduce costs. Treasurer Folwell had recently extended the deadline to sign up for his experiment, however was not able to attract hospitals to join, leaving state employees out of network with their local hospital.

News & Record: https://www.greensboro.com/news/state/folwell-stopping-fight-for-now-with-n-c-hospitals-over/article_efba4725-436c-5d0c-bb70-56989660b398.html

2019 Session Laws

The following 195 bills have become law this session:

More about Nexsen Pruet's North Carolina Public Policy Team
In addition to providing Government Affairs Services, the Nexsen Pruet Public Policy team provides attorneys and clients with a newsletter summarizing the week's activities and conveying the inner workings of the legislative process and state government in Raleigh during the legislative session. Please feel free to pass this along to your clients or other interested parties. If you would like to receive the update in your inbox, please email shernandez@nexsenpruet.com to be added to the list. If you are interested in learning more about how Nexsen Pruet can help you achieve your public policy goals and acquiring legislative representation in North Carolina or South Carolina, please reach out to Sandy Sands at ssands@nexsenpruet.com or Ross Barnhardt at rbarnhardt@nexsenpruet.com.

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