NC JUSTICE NEWS: Benefits of Health Reform + Historic Lows in State Spending + Defenders of Justice

September 21, 2010

HEALTH CARE: BCBSNC announcement shows benefits of reform
Two reports and a surprising announcement of NC's Blue Cross illustrate how important and beneficial health reform is for North Carolinians.
First, the announcement—BCBSNC is giving $155 million in refunds to more than 300,000 people who bought individual insurance policies through the company’s Blue Advantage and Blue Options HSA programs. The refunds are a direct result of the federal health reform law.
Now to the two reports, both from Families USA. The first was co-released with the Justice Center’s NC Health Access Coalition. It found that beginning in 2014, more than a million North Carolinians will be eligible to participate in huge and unprecedented middle-class tax credits to help pay for health insurance. These tax credits will be worth almost $4 billion to North Carolina families in 2014 alone. Half of those who will be eligible for the credit are uninsured, and 96% of eligible families will be working families.
The second Families USA report finds that health reform will significant reduce the health disparities between racial and ethnic groups in North Carolina. Communities of color in North Carolina stand to gain both from provisions that will affect all communities but have a disproportionate impact on communities of color and from those that are designed specifically to eliminate health disparities. These include the expansion of Medicaid eligibility, the creation of new marketplaces for insurance, and tax credits to help families pay for insurance. In addition, reform will eliminate discrimination due to pre-existing conditions, many of which minorities are more likely to have.
On Thursday at the Raleigh Community and Safety Club, the NC Health Access Coalition will be talking about options for parents to get their kids covered—through Medicaid, NC Health Choice and new options under the health law. We’ll also hear from a college student who is now guaranteed coverage under his parent’s plan because of the new health law. Come and tell your story or ask questions about the health reform law.
STATE BUDGET: Proposed cuts would drop spending to historic low
North Carolina faces a $3.3 billion budget shortfall for the next fiscal year, and Governor Perdue has called on all state agencies to create budgets with 5%, 10% and 15% cuts. Coming on top of more than two years of severe cuts averaging nearly 10 percent, across-the-board cuts of 10% or 15% would drive state spending to its lowest level since 1972. Even cuts of 5 percent would put state spending lower than all years save one in the past 40 years.
A new brief from the Justice Center’s NC Budget & Tax Center looks at state spending as a share of total personal income (TPI), which serves as a measure of the state’s economy and the size of the state’s tax base. In more than two-thirds of the past 40 years, state spending has hovered between 6% and 7% of TPI. In the past 25 years, it’s dropped below 6% only three times.
Even cuts of 5 percent will have a substantial negative impact on these vital programs, and across-the-board cuts of 10 or 15 percent will severely impair the ability of state government to make the critical investments in education, health, and public safety that form the foundation of a strong middle class. Such historically low levels of state spending would cause severe harm to North Carolina’s vital public structures, even as the enduring impact of the recession continues to elevate the need for state services. Protecting funding these services by eliminating unjustified tax breaks and ineffective business incentives would help to ensure that the state continues to make the critical investments in a healthy and trained workforce necessary to put the state on a path out of the recession.
FEDERAL STIMULUS: How the Recovery Act saved us from depression
Not only has the federal Recovery Act shored up state spending for the past year and a half, it also has helped 206,000 North Carolinians avoid poverty. In addition, the NC Budget & Tax Center finds that a million North Carolinians did not experience the full severity of Great Recession thanks to provisions in the Recovery Act.
The BTC Brief examines several national reports and finds the following:
  • Gross Domestic Product is now 1.5 percent to 4.0 percent higher than it would have been without the Recovery Act.
  • The unemployment rate in 2010 will be 0.7 to 1.8 percentage points lower than it would have been without the Recovery Act.
  • Payroll employment for the year will be between 1.3 million and 3.3 million jobs greater than it would have been without – you guessed it – the Recovery Act.
Congress and North Carolina must continue the policies that have helped working families avoid financial disaster during the recession. Congress needs to continue the numerous tax credits for working families included in the Recovery Act. And it is clear North Carolina is at a point in the recovery where an ongoing commitment to support job creation, to invest in key programs and services, and to protect North Carolinians most vulnerable to economic hardship must be the state’s priorities.
ACTION ALERT: Save jobs by extending the TANF Emergency Fund
One of those important provisions in the Recovery Act is the TANF Emergency Fund. States have used this fund to create subsidized jobs in the private and public sectors. By the time it expires at the end of September, the fund will have created approximately 250,000 jobs for low-income individuals who would otherwise be unemployed. In North Carolina, the TANF Emergency Fund has created more than 1,000 jobs.
Ending this program will cost North Carolina jobs, remove much-needed income from local economies, adversely affect local businesses, and make it impossible for many low-income parents to cover basic expenses. The country and the state need a temporary one-year extension of the TANF Emergency Fund.

The NC Justice Center's
2010 Defenders of Justice Honorees
Thursday, September 30, 6 pm - 9 pm
American Tobacco Campus, Bay 7, Durham, NC
State Senator Joe Sam Queen of Waynesville for his commitment to increasing the availability of affordable housing and providing assistance to working families
State Representative Garland E. Pierce of Scotland County for his continuing efforts to ensure the needs and interests of North Carolina’s poor families are represented in the state legislature
Kay Zwan of Wilmington for her passionate advocacy for increased access to health care and her efforts to increase public support for national health reform
Jane Wettach of Duke University’s Children’s Education Law Clinic for her work to ensure students at risk of failing or being excluded from school get the quality education to which they have a right
Great Schools in Wake for being a strong voice in opposition to the resegregation of Wake County schools and for quality education for all Wake students
Join us in honoring the work of these great individuals
by becoming a sponsor of the awards night.
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