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March 3, 2009

Expected Medicaid Savings from Stimulus Package
Based on projections from the NC Association of County Commissioners (NCACC), Mecklenburg County is in line to save an additional $3.2 million in Medicaid costs due to the federal stimulus package. The NCACC's analysis of Medicaid savings from the stimulus bill has been attached to this week’s Board Bulletin.
Board members may recall from earlier analysis that the federal stimulus package increased the federal participation in Medicaid, with a retroactive increase back to October 2008. Since North Carolina’s counties' share of Medicaid is set at 7.5% of the non-federal share, North Carolina’s costs are reduced proportionally to the increase in federal reimbursement for Medicaid. Although the federal enhanced participation continues through 2010, our Medicaid share is eliminated after June 2009. Statewide, NCACC calculates county Medicaid savings to exceed $43 million for the eight-month period.
According to NC Department of Health and Human Services staff, counties should expect to realize the credit for retroactive enhanced federal participation (cost months October 2008 - February 2009, warrant months November 2008 - March 2009) with the March 2009 Medicaid warrant draft. The April-June drafts will be calculated automatically at the new federal participation rate.
Please note, County savings resulting from the increased federal Medicaid participation will not impact the Medicaid hold harmless payment calculation as set forth in the county Medicaid relief swap legislation. We will continue to monitor the situation and update the Board as needed.
Proposed NC Senate Bill Threatens More Harm to Counties
Last week’s Board Bulletin reported the state’s decision to redirect the distribution of Average Daily Membership (ADM) funds, as well as lottery funds, to help address its revenue deficits. ADM funds are derived from a portion of corporate income tax receipts and are used for school construction and debt service.
This week, a bill was introduced in the NC Senate which, if approved, would take money from the ADM funds and use them to help offset the State’s declining revenues. Senate Bill 386 titled, “Make Best Use of Corporate Tax Revenue” was sponsored by Mecklenburg County’s Senator Dan Clodfelter and co-sponsored by senators from Edgecombe and Gaston County. If approved, this bill will divert funds from counties to the state’s general fund for the next two years. By retaining this revenue rather than providing it to counties to help pay for school construction or school debt service, the state will subject Mecklenburg County to a substantial loss - nearly $9 million, based on prior years’ revenues. We will continue to monitor this situation and report to the Board as it evolves.
DSS and CMS Collaborating on Free and Reduced Lunch Eligibility
Mecklenburg County Department of Social Services (DSS) and Charlotte Mecklenburg Schools (CMS) have a longstanding data sharing partnership. In January, CMS was acquiring data for Direct Certification of the School Lunch Program from the State, which prompted a meeting between DSS and CMS to review commonalities of clients. In this situation, the goal of both CMS and DSS is to ensure that those children who are eligible for free and reduced lunch are enrolled in the program. The secondary purpose of the collaboration is to improve processes to prevent unnecessary costs.
Of particular concern to CMS were families who consistently do not respond to the request to complete free and reduced lunch applications, although they qualify. An additional concern involves students eligible for reduced lunches who have not submitted an application, but are receiving free lunches. The lack of payment from these students accumulates as a cost to CMS. For the current school year, the cost due to lack of payment is $328,000.
Within the first two months of data sharing, 99 more students were qualified for free lunch and 35 more students were qualified for reduced price meals. Due primarily to the additional enrollment for students who qualified for free lunch resulted in reduced CMS costs by more than $20,000. Therefore, although more students have become eligible through data verification, CMS cost obligations have decreased in this area.
By sharing data related to the USDA’s Food & Nutrition Service (FNS) and US Department of Health & Human Services Temporary Assistance for Needy Families (TANF) DSS is able to provide CMS with relevant information on those students who are eligible, but may not be enrolled and/or using the programs available to them.
DSS has created new processes to educate its clients on the program. By reaching out to these clients, DSS may be serving some of those families who are eligible but have not been using the program through CMS. DSS has placed highly visible signs at its information desks notifying visitors about the “CMS Free/Reduced Meal Applications.” Additionally, DSS will give applications to all customers requesting a food referral form. DSS will then deliver these applications to CMS in a timely manner. DSS also is providing CMS daily access to its food stamp approval data.
DSS and CMS are continuing to collaborate on this and other efforts where data sharing will enhance services and produce efficiencies and other cost-savings.
- Harry L. Jones, Sr., County Manager


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