NC Budget and Tax Center

Legislature’s budget fails to properly account for $40 million loss in federal funds for Medicaid

By rushing the budget process and working to pass a $23.9 billion state budget in less than a week, legislators are putting our state in a deeper hole by failing to account for the loss of federal funds that have begun under the Trump administration.

It is known that Governor Cooper has called for Medicaid expansion, while the legislature has refused to provide health coverage for over 600,000 people in need. What is not widely known is that the percentage of federal assistance that North Carolina receives from the federal government has decreased for the upcoming fiscal year.

North Carolina’s FMAP (Federal Medical Assistance Percentage) declined from 67.61 percent in federal fiscal year 2017-18 to 67.16 percent in federal fiscal year 2018-19. Even though this change may not seem like much at first glance, the reality is that this loss has an impact to our state of almost $40 million. In other words, our state has to come up with that much to maintain the same levels of Medicaid services.

While the governor recommended addressing the federal cost-shift to North Carolina (while also accounting for updates to enrollment numbers) to ensure our state can maintain the same level of services for those eligible for Medicaid, the legislature assumed the same level of federal support as last year.  The result is that North Carolina will once again come up short under the legislative leaders’ proposal in serving the healthcare needs of its people, the vast majority of whom are children, older North Carolinians and people with disabilities.

Luis Toledo is a Public Policy Analyst for the Budget & Tax Center, a project of the North Carolina Justice Center.

2 Comments


  1. Lisa Harrison

    May 31, 2018 at 11:24 am

    Thank you Luis. We must shine light on the downstream effects of these decisions. Public health will not be able to continue to limp along like this. It is imperative we find ways to fund the safety net services like local public health departments. This loss will be felt in EACH county in NC as programs and services continue to diminish. The notion that “an ounce of prevention is worth a pound of cure” has gotten lost pretty fast. The NC Legislature was indicating just a few short months ago that they really (seemingly) understood the importance of adequately funding communicable disease across NC. Not only is this Medicaid loss going to be felt hard, but the $8,000,000 needed just to get local health department infrastructure back to 2010 levels (which was said to be feasible this year) is nowhere to be seen in any budget. Astounding. It’s incredibly difficult to continue dedicating a life’s work in public service in NC when public service is no longer valued or supported. Return on Investment is clear – please help advocate for Medicaid Expansion if you want to save health care dollars and services for North Carolinians. Our federal tax dollars continue to go to states smart enough to maximize the utilization of that revenue to save state and health care dollars. Why continue to be so stubborn NCGA?????? Stop listening to partisan dramatic fear tactics and look at the data….please be smart about our health and seek help our state’s hard-working public servants so they can help others in local communities. We’re dying on the vine out here in rural NC…. the privatization of schools and health departments in rural NC is simply not an option. But reducing these essential community services to nothing surely seems to be.

  2. Kathleen DeVore

    May 31, 2018 at 4:56 pm

    Right on, Lisa! What a disappointment!

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