Kody Kinsley, North Carolina’s top health official, wears a suit while sitting in his office on August 28, 2023. He is looking directly at his computer’s web camera and addressing reporters during a video conference call.
Kody Kinsley, secretary of the N.C. Department of Health and Human Services, during a Zoom call with reporters on Monday.

By Jaymie Baxley

Kody Kinsley, head of the N.C. Department of Health and Human Services, announced Monday that uncertainty over the state budget may push the launch of Medicaid expansion into next year. 

The department had hoped that expansion, which is expected to provide health insurance to hundreds of thousands of low-income North Carolinians, would go live in October. That timeline was contingent on the General Assembly either approving a budget or voting to give DHHS the authority to move forward without a budget by Sept. 1 — this Friday. 

“Unfortunately, as we’ve come into this final week of August, it’s become clear to us that we will not be able to have a budget passed in time and enacted. Nor will we have separate authority to move forward,” Kinsley said during a video conference with reporters. “This is a tragic loss of health insurance for nearly 300,000 people that would have coverage on day one, delaying something that we know they and their families need so badly.”

The delay will affect an additional 300,000 residents who would have been able to sign up for Medicaid shortly after the rollout, along with a significant number of existing enrollees who were recently deemed ineligible for coverage. 

In March, when North Carolina became the 40th state to pass legislation expanding access to Medicaid, the law’s implementation was tied to the passage of a state budget. The requirement was widely seen as a minor formality at the time, with lawmakers promising to have a spending plan in place by the beginning of the state’s fiscal year at the start of July. 

All spring, it appeared that legislators were on track to deliver a budget by the deadline. But once negotiators from the state Senate and House of Representatives sat down to hammer out the differences between the two chambers’ priorities, the process ground to a halt.

Sensing the impasse could drag on, DHHS put forth a plan on July 26 to “decouple” expansion from the budget. But the proposal, which would have allowed the department to circumvent the political stalemate and begin working to officially launch expansion on Oct. 1, failed to receive the necessary go-ahead from the General Assembly.

“There’s still some things that we would have to do that we really cannot do without the official thumbs-up, which is why this is going to delay us at this point,” Kinsley told reporters. “While they may have a budget [by] the middle week of September, we needed an enacted budget or, even easier, decoupling authority.”

There are “several variables,” he added, that prevent the department from scheduling a new rollout date for expansion at this time.

“Depending on how far it slips for them to give us the final authority to move forward, it could be December at the earliest — [or] it could slip into 2024,” Kinsley said. “We’re going to work to try to make it happen as soon as possible. But again, we need their thumbs-up to move forward.”

What’s at stake?

Once implemented, expansion will loosen some of the state’s long-standing requirements for Medicaid. 

The annual income limit for eligibility will increase to 138 percent of the federal poverty level, or about $20,120 a year for a single person who is older than 18 and has no children. To put that into perspective, the average annual salary for a full-time worker earning minimum wage in North Carolina is about $15,000.

About 600,000 people are expected to qualify for Medicaid under expansion. Kinsley said 80 percent of these residents “come from working families.”

“Many of these individuals are working two or more jobs,” he said. “A lot of them are working in the childcare industry, which we know is so critical for the health and development of children and for their parents to work as well.”

In addition to allowing more North Carolinians to sign up for Medicaid, expansion would protect an untold number of existing participants from losing their benefits.

During the first three years of the COVID-19 pandemic, a federal mandate prevented states from kicking Medicaid beneficiaries off the rolls. That mandate ended in April, allowing states to check participants’ eligibility and disenroll ineligible people for the first time since 2020.

Kinsley estimates that at least 18,000 expansion-eligible North Carolinians have lost Medicaid since the state resumed terminations in June. He predicts that another 9,000 will lose coverage by the end of the month. 

The delay could also have financial consequences for the state, which had been promised a  $1.6 billion “signing bonus” from the federal government if the legislature passed Medicaid expansion. Kinsley has said North Carolina will not see any of the money until “we enroll our first beneficiary.”

“Each month of delay costs the state hundreds of millions of dollars flowing into communities across North Carolina to support care and treatment for people and help keep providers’ doors open,” he said in a news release following Monday’s announcement.

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Jaymie Baxley reports on rural health and Medicaid for NC Health News. He can be reached at jbaxley at northcarolinahealthnews.org

4 replies on “Medicaid expansion unlikely in NC in 2023 with lawmakers’ stalemate over budget”

  1. The NC Legislature fiddles while the poor and infirm burn.
    If there is a hell, I hope legislators of both parties get a chance to visit!
    The ONLY real job that the legislature has to do it create a state budget. And they can’t manage to do that even though they control both chambers. If I had my way I would fire all 270 members and send them packing, In their place, I would ask 270 primary school teachers to step up and get the job done. I am guessing the entire responsibility of the General Assembly could be completed in a weekend! Now there is a way to save some money in NC!
    The General Assembly of NC should really be ashamed of their inaction and the citizens of the state should demand an apology from the House Speaker and the President of the Senate for failing to do their job in a timely manner.

    1. Here is an idea- how could the people of N.C. have a mandate or bill that says if the state legislature cannot complete the budget by the deadline, their pay stops until they get the budget passed. How can we make that happen?

  2. Seriously, this is when we believe elected officials are totally out-of-touch with their constituents. With the great Medicaid “unwinding” our local DSS offices are slammed and North Carolinians need options for basic health care coverage now. Having Medicaid as an option for some of our most vulnerable residents would have been nice. Instead, our elected officials apparently like to create more administrative headaches for DSS/navigators, etc. and worst of all – they want to deny care to people who need – and deserve it. Add to this the NCGA wanting Medicaid “predictability” and then carving out the most expensive/intensive needs (individuals who are dually eligible or who have TBI and behavioral health issues) and then have private insurers administer the “predictable” folks…and punting the beginning of these tailored plans….again and again. The public servants at NC DHHS who are over-seeing this are also being told (if new employees) that they will not have retiree health benefits themselves. I think we are forced to ask: Is the NCGA trying to make NC the worst state in the US to work for government or rely on the government for basic supports? And be on the lookout for more consolidation of healthcare and soaring prices because of the NCGA “deals” with big business. Such a sad commentary about North Carolina and who has been elected to do the peoples’ business.

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