Butterfield introduces federal legislation to eliminate county Medicaid share

North Carolina counties gained a key ally in their fight to be relieved of their Medicaid burden when Congressman G. K. Butterfield on Jan. 9 introduced the Medicaid County Protection Act of 2007, which would prevent states from passing along their Medicaid costs to counties.

More on Medicaid relief

“Medicaid is a vitally important and successful cooperative program between the state and federal government,” Butterfield said. “Passing along the state’s burden to the counties is making it increasingly difficult for many communities to provide basic services.”

North Carolina is the only state that requires counties to pay a fixed percentage of the state’s Medicaid responsibility. The state requires North Carolina counties to pay 15 percent of the non-federal share. In 2005-06, North Carolina counties paid nearly $460 million to subsidize the state’s Medicaid share.

State legislators did provide up to $27.4 million in the 2006-07 budget to temporarily cap county Medicaid costs at 2005-06 levels, and the State-Local Fiscal Modernization Study Commission has been charged with devising a strategy to relieve counties of the Medicaid burden.

“Medicaid relief has been the No. 1 priority for North Carolina counties for several years, and the recent actions of the General Assembly show that state legislators are listening to our concerns,” said NCACC Executive Director David F. Thompson. “We are grateful that Rep. Butterfield is taking this fight to Washington, D.C.

“The Medicaid burden is particularly devastating on our rural counties, some of whom spend nearly one-third of their property tax revenue on Medicaid costs. In other counties, the Medicaid responsibility is diverting county funds from such critical needs as new schools.”

A 2006 survey by the N.C. Department of Public Instruction revealed approximately $9.7 billion of new schools will be needed in the state over the next five years to handle the state’s rapidly growing population and to accommodate recent legislative mandates for smaller class sizes in the lower grades.

Butterfield said that the current situation is very difficult for many of the poor and rural communities that he represents because local property tax revenues simply cannot keep up with growing Medicaid costs. Butterfield also pointed out that states, unlike counties, have the ability to make changes in eligibility, covered services, and how those services are reimbursed and delivered.

“Medicaid costs for some counties grew as much as 137 percent over the last seven years, yet counties lack any means to deal with the huge increases,” Butterfield said.