Research Reports: Health Care & Human Services

Rutherford County doesn't need to increase taxes The Rutherford County commissioners are asking voters to approve a quarter-cent sales tax increase and a 200 percent increase in the real estate transfer tax on November 6. But the county has about $25 million over and above its base budget to meet its needs.

The Macon County commissioners are asking voters to approve a 200 percent increase in the real estate transfer tax on November 6. But the county has about $21.6 million over and above its base budget to meet its needs.

North Carolina’s 2001 mental health reform was ambitious and well intentioned but flawed. Many proven ideas did not make the final version of reform and lawmakers immediately raided the mental health trust fund to cover a General Fund fiscal crisis in 2001.

Health insurance should act like insurance, not a payment plan for regular medical needs. It should also be available for individuals to purchase in a deregulated market. A high-risk pool for health insurance, as in other insurance markets, would keep premiums affordable for the small percentage of those with significant care needs without raising costs for the entire market. The state of North Carolina should finance any high-risk pool entirely through the General Fund and existing taxes, rather than assessments on insurers or other hidden taxes. Money for a high-risk pool can come from Medicaid savings.

North Carolina’s largest public transit systems are often credited with reduced traffic congestion and air pollution, efficient land use, reduced dependence on oil, and much-needed mobility for some residents. Are they fulfilling these missions? How are they performing? Who do they benefit? What do they cost?

Health care is again a top priority for most Americans. Health savings accounts offer promise and are growing in popularity among companies and individuals. Three states will soon begin consumer-directed Medicaid pilot programs. These are more realistic approaches than proposals by the NC Institute of Medicine and others to expand Medicaid or to force employers to provide health insurance. Individuals, not companies or the state, are best equipped to manage their own health care. Health care reform should start from this premise.

HSAs are a form of medical savings account, similar to the now-familiar IRAs. These accounts are the property of the employee and can accumulate interest and dividends like other savings vehicles. Funds that are not used for health care-related expenses can be used for retirement living and can also be willed to one’s heirs. When combined with a high-deductible health insurance policy, an HSA replaces traditional health insurance coverage – and does so in a way that results in a more consumer-driven approach to health care.

In North Carolina and 34 other states, if you are a health care entrepreneur and you want to do anything from adding a new wing or extra beds to an existing hospital, to opening an office that offers MRI or other services, you need a “Certificate of Need” from the state. If this sounds like the kind of central planning one might find in a socialist economy – it is. In North Carolina, the central planning authority is known as the Health Planning Development Agency, part of the North Carolina Department of Health and Human Services. The role of this agency is to plan economic activity provided by medical-care facilities. This is done down to the most minute detail, circumventing the most basic function of private decision-making in a free enterprise system, i.e., the allocation of resources based on entrepreneurial insight and risk taking.

North Carolina is the only state in which counties pay a fixed percentage of Medicaid costs. Counties have no control over how they spend up to 15 percent of their general fund budget and 39 percent of their property tax revenues. Six counties spend more on Medicaid than on education. Program expansions and higher medical costs have pushed Medicaid’s share of county budgets up an average of 18 percent in five years. The General Assembly should act on the recommendation of its own Blue Ribbon Commission on Medicaid Reform to cap and reduce what counties must contribute to Medicaid.

Multi-million dollar bond referendums and tax increases will not repair the damage done by years of inadequate school facilities planning. With construction and labor costs rising, massive school building programs, such as the one proposed by the Charlotte-Mecklenburg Schools (CMS), will exert a crippling tax burden on local communities.