Lee County should benefit at least $500,000 annually from the recently enacted state plan to phase out the requirement that counties foot 15 percent of the state’s Medicaid services bill. Once fully implemented, the plan eliminates an uncontrollable expense increasing at roughly 10 percent or more per year in exchange for a revenue source growing at about 5 percent.
Specifically, counties statewide relinquish a half-cent of sales tax revenue, which is projected at $592.6 million in 2012, in exchange for the state assuming the entire non-federal Medicaid share, which is projected at $744.5 million in 2012.
Lee County's "savings" could be substantial, averaging perhaps as much as $900,000 a year over the next five years according to estimates by the North Carolina Association of County Commissioners. But as County Manager John Crumpton pointed out, this is only an estimate based on Medicaid costs--something historically hard to estimate accurately. Moreover, this financial relief does not come in the form of new money but simply "costs avoided." It doesn't "free up money in the county budget" directly because the money for future years hasn't been budgeted. Nevertheless, the bottom line is good news. It is a financial pressure that will be lifted from the county budget and, hopefully, off the tax payer's back.
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