In a significant development for North Carolina’s healthcare system, Governor Josh Stein has instructed the state’s Department of Health and Human Services to reinstate Medicaid reimbursement rates to their status as of September 30, 2025. This decision comes in response to recent court orders and ongoing litigation, which have intensified as a result of the legislature’s inability to fully fund Medicaid, leading to previous cuts in the program.
Governor Josh Stein emphasized the urgency of the situation, stating, “North Carolinians who rely on Medicaid are suffering because the General Assembly has failed to fully fund the program.” Despite the rate restoration, a substantial funding gap of $319 million persists, urging the legislative body to act swiftly to preserve healthcare access for over three million residents.
NC Health and Human Services Secretary Dev Sangvai echoed these concerns, noting, “Underfunding a program this critical and putting it at risk is not something we can take lightly. Medicaid is a lifeline for 3 million North Carolinians, and ongoing uncertainty threatens the health of our entire state.”
North Carolina’s unique position as the only state without an enacted budget has exacerbated the fiscal crisis in Medicaid. The NCDHHS has long warned about the program being underfunded by hundreds of millions, a shortfall that, without legislative intervention, could lead to the exhaustion of funds before the fiscal year ends. This would endanger healthcare services for millions in the state.
Support from Healthcare Stakeholders
Healthcare providers and advocates across North Carolina have voiced support for the Governor’s move. Josh Dobson, President & CEO of North Carolina Healthcare Association, expressed gratitude, stating that the reversal of cuts is “an encouraging step toward stability for providers and the patients who depend on them.”
Theresa McCarthy Flynn, President of the NC Pediatric Society, highlighted the importance of this decision for pediatricians, noting that previous cuts threatened the viability of many practices. She emphasized the need for a long-term funding solution to ensure continued healthcare access for children.
Other healthcare professionals, including members of the North Carolina Psychiatric Association, the Autism Society of NC, and the Addiction Professionals of North Carolina, have similarly praised the Governor’s intervention. Sara Howe, CEO of Addiction Professionals of North Carolina, described the rate reversal as a “lifesaving decision” for substance-use providers, ensuring continued availability of critical treatment services.
Representatives from various associations, such as the NC Occupational Therapy Association, North Carolina Community Health Center Association, and Developmental Disabilities Facilities Association, have all underscored the necessity of stable Medicaid funding for maintaining essential health services and supporting vulnerable communities.
The consensus among healthcare leaders is clear: the full funding of Medicaid is imperative to sustain quality care and support the healthcare workforce. As Bonnie Davis Meadows, NCNA President, succinctly put it, “Fully funding Medicaid is vital to ensuring that North Carolina patients have the access to quality care that they need and deserve.”
As the state navigates this financial predicament, the healthcare community remains committed to collaborating with the Governor and the General Assembly to secure a sustainable path for Medicaid, ensuring the health and well-being of all North Carolinians.
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