NC Medicaid expansion to launch on Dec. 1, granting health insurance to thousands

Medicaid expansion will launch on Dec. 1, granting health insurance to hundreds of thousands of North Carolinians, Gov. Roy Cooper says.

Medicaid expansion is historic for North Carolina, which previously was one of just 11 states that had not yet implemented the federally authorized expansion.

“Since my very first day as governor, getting help to people who need it by expanding Medicaid has been a top priority,” Cooper, a Democrat, said during a news conference Monday at the Executive Mansion. “I hear countless stories from everyday people, many who earn a living, working two or more jobs to make ends meet. But it isn’t enough to afford health care.”

“Finally, help is on the way. With much work being done to prepare even as we speak, beginning December the first of this year, North Carolina will expand Medicaid,” said Cooper, who added that he had spoken with federal health leaders on Friday to discuss the implementation of Medicaid expansion.

According to the state Department of Health and Human Services, expansion will allow about 600,000 North Carolinians to qualify for this insurance program, which will now cover all adults in the state who make below about $20,120 a year. It will also allow many people who lost coverage under a federally required Medicaid eligibility renewal process to regain it. DHHS is a cabinet agency under Cooper.

Previously the income limit for eligibility under Medicaid for a parent or caretaker in North Carolina was 41% of the federal poverty level, or just over $8,000 yearly for a family of three.

Adults without children, save for those with disabilities or other qualifying exceptions, had no coverage.

People who did not qualify for Medicaid under the prior tighter parameters could apply for federal subsidies, but these were limited and many were not eligible. This meant many people fell into a coverage gap in which they earned too much to qualify for traditional Medicaid but too little to receive subsidies.

On Monday afternoon, President Joe Biden said in a news release that “every American deserves high-quality affordable health care. Period. So I applaud Governor Cooper and the bipartisan elected officials who have made North Carolina the 40th state to expand Medicaid under the Affordable Care Act.”

Medicaid was signed into law in 1965 but had tighter eligibility requirements. The ACA, passed during President Barack Obama’s administration, expanded those parameters. States could chose whether to opt into the expanded parameters.

Biden also praised how expansion would help thousands, as well as benefit rural hospitals, and said his administration works “to bring down the cost of health care for all Americans, and I’ll continue to urge leaders, especially those in states who have not yet expanded Medicaid, to join our efforts.”

300,000 eligible immediately

DHHS Secretary Kody Kinsley, who said he grew up without insurance in North Carolina, on Monday said that about 300,000 North Carolinians will be moved into full coverage on Dec. 1.

“For the remainder of those that are eligible, our county partners had been hard at work to ready their systems and their staff and their processes to enroll members as they come forward,” he said. DHHS had also been working to update technology and other systems to make the move into coverage smooth, said Kinsley.

“We have 1.2 million people in North Carolina without health insurance. Medicaid expansion is going to do a major effort in getting that gap closed,” he said.

Asked how long it may take for those not immediately deemed eligible to gain coverage, Kinsley said this will “depend a bit on how they come forward.” He said DHHS is working with stakeholder groups, churches, faith organizations and civic organizations to inform people.

Laura Gerald, president of the Kate B. Reynolds Charitable Trust, and Susan Shumaker from the Cone Health Foundation said in a joint statement that their foundations and others “have pledged more than $3 million in private funding to support Medicaid outreach and enrollment efforts to ensure eligible residents have the information they need to enroll in Medicaid and access affordable, quality health care.”

“This is a long-term effort that will require additional public and private dollars to reach diverse communities across the state. We are calling on policymakers to make Medicaid expansion a priority and to invest in robust outreach and enrollment efforts in the coming months and years,” they said.

Reticence to expand

Medicaid expansion in North Carolina has been in limbo for years. North Carolina Republicans previously were reticent to expand Medicaid, initially citing financial concerns. Cooper, who has been governor since 2017, has pushed for expansion throughout his time in office, including in 2019, when there was a budget impasse with Republicans partially due to Cooper’s push for Medicaid expansion.

But, by 2022, Republicans’ appetite had shifted. Senate leader Phil Berger and House Speaker Tim Moore, who both hold veto-proof supermajorities in their respective legislative chambers, announced in March that they had reached a Medicaid deal. This deal included cuts to regulations on hospital competition and created a new mechanism for hospitals to get higher reimbursements.

By the end of March, the expansion bill had passed both legislative chambers with bipartisan support and was signed into law by Cooper. The expansion deal also includes a two-year, $1.6 billion federal payout. These funds, used as a federal incentive for non-expansion states, will be used to bolster mental health resources in the state and more, according to the budget deal.

Kinsley said Monday the legislature had approved about $700 million of this funding for use on behavioral health, including several hundred million in recurring money. He said $200 million would be used to support child and family well-being “so that children don’t have to sleep in DSS offices and we can serve people in hospitals better.”

Medicaid delays

Under the Medicaid deal drafted by the GOP, the state needed to pass a budget to trigger Medicaid. The state failed to pass a budget by July 1, the start of the new fiscal year, largely due to disagreements with the House and Senate on the legalization of casinos. Last week, Republican leaders announced they had reached a deal on the state budget that did not include casinos but that would trigger Medicaid. By Friday, the 625-page spending plan had been passed by both legislative chambers.

Shortly after the passage of the budget on Friday, Cooper announced he would let the bill become law without his signature, citing Medicaid expansion as the main reason, while also calling it a “bad budget,” as previously reported by The News & Observer.

Cooper could instead have signed the budget or vetoed it. If he had vetoed it, this would have required override votes by the legislature, further delaying passage of expansion.

On Monday, Cooper said “after months of waiting, the budget has passed and Medicaid expansion will happen. I know there’s a lot of bad in the budget that they’ve passed. And I expect lawsuits to challenge the constitutionality of a number of parts and I cannot in good conscience, sign my name on to it.”

“And even though a veto of this budget would have been well deserved, that would take this bill out of my hands and send it back to this legislature where even more mischief could have put Medicaid expansion at risk. In this legislative circus, we can’t take any more chances on delay or defeat with the lives of so many people at stake,” he said.

The budget passed by the General Assembly includes a 7% raise for state employees and non-certified school employees and teachers over the next two years and an average raise of 7% for teachers over that same period, The News & Observer previously reported. It cuts taxes, including by reducing the personal income tax rate to 3.99% by 2025. The rate could drop to 2.49% if revenue collection goals are met. It also has a major expansion of private school vouchers and has many policy provisions tucked into it, including a provision that expands lawmakers’ exemptions from public records law.

Kinsley had previously said that if the budget passed by Sept. 1, implementation could launch by Oct. 1. But in late August, he said that due to continued delays, it would need to launch by December or later. On Monday, he confirmed it would launch by Dec. 1 and said North Carolina has “a significant amount of work” to do at the state and county levels before that date, including notices to newly eligible North Carolinians.