ASHEVILLE, N.C. (828newsNOW) — North Carolina Health and Human Services Secretary Dev Sangvai warned Wednesday that recent budget decisions by state lawmakers could lead to cuts in Medicaid services and rates, potentially impacting care for millions of residents.
Gov. Josh Stein signed a stopgap spending plan, or mini budget, into law after it passed the General Assembly. The measure includes $600 million to support the state’s Medicaid rebase and Medicaid Oversight Fund. However, that amount still leaves a $319 million shortfall in funding needed to maintain current service levels.
“To remain within budget, NCDHHS now has two options to address a shortfall from an insufficient rebase; reduce optional services and/or reduce provider rates,” the department said in a statement.
Sangvai criticized the underfunding, warning that it jeopardizes the integrity of a program that more than 3 million North Carolinians rely on.
“Underfunding NC Medicaid now, after years of building a nationally recognized program that delivers real outcomes, is a serious setback,” Sangvai said in a news release. “The forced cuts from the budget shortfall threaten care for those who need it most and include some of North Carolina’s most vulnerable populations.”
He added that continued budget strain — along with the possible loss of initiatives like the Healthy Opportunities Pilots — could erode the Medicaid program over time. Despite the challenges, he reaffirmed the department’s commitment to its mission of improving the health and well-being of residents.
Stein also expressed concerns after signing House Bill 125, saying the temporary funding plan “fails to fully fund health care” and falls short in supporting teachers, public safety and state employees.
“With federal cuts on the horizon, the legislature’s forced $319 million cut to Medicaid will be particularly painful,” Stein said in a statement. “Despite these serious reservations, I am signing this bill into law because it keeps the lights on.”
He urged lawmakers to return with a more robust and long-term funding plan.
“We have so much going for us here in North Carolina, but we cannot just rest on our laurels, do the bare minimum and expect to continue to thrive. The General Assembly needs to get serious about investing in the people who make this state great,” he said.
