Former DHHS head defends his tenure

RALEIGH (WTVD) -- Gov. Pat McCrory has made it clear that the state's Department of Health and Human Services is broken and that he intends to fix it.

The new department secretary has echoed that sentiment. Now, her predecessor, Lanier Cansler, is defending his tenure.

"DHHS is changing in the way we operate," said current NC DHHS Secretary Aldona Wos.

That was Wos last month, after a scathing audit of the state's Medicaid system found the agency broken in places and way over budget.

"Cost overruns will not be tolerated and will not be acceptable," said Wos.

What Wos didn't get into that day was why it went over budget.

"I kind of wanted to say 'Hey, let me explain, let me explain,'" said former DHHS Secretary Lanier Cansler.

Former Republican lawmaker Cansler ran DHHS for four years under Democrat Gov. Bev Perdue, and, when his former Republican colleagues cut the Medicaid budget by more than $350 million dollars, he sounded the alarm in person and on paper.

In a letter, Cansler wrote that "aggressive budget cuts mandated by the General Assembly's budget are unreasonable and unattainable."

"I use the analogy if your house payment is $2,000 and someone tells you [that] you can only budget $1,800 for it, it doesn't mean it's going to change to $1,800," said Cansler. "It means you've got to figure out how to pay the $2,000."

Cansler says there are four ways to cut the Medicaid budget: Restrict who is eligible, cut reimbursement rates for doctors and hospitals, cut services, or cut administrative costs. He said the first three often require a go-ahead from state lawmakers or Washington.

"Once it's out there and once you define the eligibility, and you define the services, if the bill comes due, you have to pay it, no matter what your budget is," said Cansler. "So that's why we were over budget."  

Cansler says he tried to cut administrative costs, but couldn't find nearly enough fat to trim to hit the legislature's numbers. So he asked for guidance.

"They said we want you to scale back what you're doing with vision," said Cansler. "We want you to scale back what you're doing with dental. We want you to scale back, but in the scheme of things, those are pretty small things compared to what the larger cuts are."

When it comes to those larger cuts, Cansler says the ripple effects can be huge.

"You start cutting back in one area, trying to better control it," he said. "It may be putting small health care providers out of business."

The problem, to Cansler, who now consults on health care issues, is that there's no vision of what Medicaid, and health care in general, should look like in North Carolina.

"We need to set out and develop that vision of who should take our system over the next five or ten years and every decision we make about budget, about laws, about what we need to do to achieve that goal," said Cansler. "That conversation really has not happened."

Still, Cansler has high hopes for Wos and DHHS, but when it comes to that tough talk on how things were done in the past, Cansler had this final thought.

"I would just say that I don't think that things are as bad as they seem and there are really a lot of good people who've been involved with this for years who have North Carolina at their heart and I hate for them to be portrayed as not having done a good job when in fact they worked hard to do a good job," said Cansler.

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