Carolina Cares: A Republican Big Government Healthcare Solution for NC

RALEIGH – Some Republicans in Raleigh attempting to out-Democrat Democrats with a proposal to create a brand new government-mandated health insurance program to give subsidized insurance to around 300,000 North Carolinians.

Democrats in North Carolina have been pushing Medicaid expansion for years, ever since Obamacare passed nearly a decade ago. They argue it was ‘free’ money, job-creating, and compassionate in that it provided health insurance coverage to more than half a million people in the Old North State. Indeed, Democrats, led by Gov. Roy Cooper, are still pushing the issue, and, though Republicans have thus far resisted the Big Government expansion, their resolve is being tested.

Enter ‘Carolina Cares,’ a supposedly conservative answer to Democrats’ calls for Medicaid expansion. Even the name sounds like a Leftist’s play on compassion via government mandate. While the legislation is not Medicaid expansion, per se, it offers similar coverage and relies on the same kind of federal funding mechanisms. Of course, it is also based on the notion that government, not the market, is the answer to our health insurance woes.

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Already, conservatives should be suspicious of such a Big Government solution to a problem caused by Big Government in the first place. Why is it that some Republicans are so inclined to push the expansion of government while they literally campaign on smaller, limited government?

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Republican sponsors of the bill have clapped back in response to criticism that it is merely Mediciad expansion under a different name, saying that it is a wholly separate program that does not add to Medicaid rolls. Yet, that is part of the problem. Why are we creating a brand new government health insurance program when we know how disastrously expensive and inefficient other such programs have been? Not to mention that it goes against what Republicans are supposed to stand for, let alone conservative Republicans.

So what are the nuts and bolts of said ‘not-Medicaid expansion’ expansion?

According to the Civitas Institute, and based on the 2017 legislation:

“The proposal requires that the state Department of Health and Human Services (DHHS) get approval for the program through a 1115 waiver. This refers to Section 1115 of the Social Security Act. According to the Kaiser Family Foundation, Section 1115 waivers are submitted by states to the federal government in order to, “waive provisions of major health and welfare programs authorized under the Act, including certain Medicaid requirements, and to allow a state to use federal Medicaid funds in ways that are not otherwise allowed under federal rules.”

The federal government would have to approve Carolina Cares under a Section 1115 waiver, which is used to modify state Medicaid programs. Federal funding for Carolina Cares would also be considered “federal Medicaid funds” according to the waiver.

In Section 7 of the Carolina Cares proposal, it directs the state DHHS to “seek the highest federal financial participation percentage available” through a federal medical assistance percentage (FMAP). FMAPs are used by the federal government as a matching percentage for certain social programs, with the primary one being – you guessed it – Medicaid.”

So, when you peak under the hood, Carolina Cares’ innards seem to have an awful lot of Medicaid labels on them. Judging by the bill itself, it would have to be approved and funded under the federal Medicaid program, though we’re not sure if it would be administered by the NC Medicaid program itself.

But wait, there’s more. Again, from Civitas:

“House Bill 662, the legislation that laid out the plans for Carolina Cares, also specifies that Carolina Cares insurance “shall comply with applicable federal requirements governing Alternative Benefit Plans.” This suggests that the insurance product is or will essentially be treated as an Alternative Benefit Plan.

According to research group Health Management Associates, Alternative Benefit Plans are the type of plans offered under ACA Medicaid Expansion. This point is clearly demonstrated in the 2019 Medicaid expansion bill filed by legislative Democrats. Section 2(a) of House Bill 5 says that “beneficiaries eligible for the Medicaid program under this section shall receive benefits through an Alternative Benefit Plan that is established by the Department consistent with federal requirements.” […]”

So let’s review:

  • Carolina Cares introduces a new government-mandated and administered subsidized insurance product to cover uninsured populations (of mostly able-bodied working adults);
  • Carolina Cares relies on the same federal mechanisms for funding as Medicaid expansion;
  • Carolina Cares is defined as an ‘Alternative Benefits Plan,’ which is exactly what Medicaid expansion plans are defined as;
  • and, Carolina Cares is designed for the same purpose as Medicaid expansion

Put simply, and echoing the conclusions of the conservative Civitas, Carolina Cares is at its root an; expansion of the welfare state’ in North Carolina. Doesn’t sound very conservative, does it? It may better be described as a slightly less irresponsible proposal to extend Big Government into the health insurance business; this time coming from some Republicans.

How did the Big Government’s last foray into the health insurance market work out for us?

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