Gov. Josh Stein is again calling on the General Assembly to fund the Medicaid rebase by convening in a special session on Nov. 17.
“Our state’s Medicaid program is in crisis, manufactured by our General Assembly, and people are suffering,” he said at a press conference on Thursday. “Fortunately, because the General Assembly created this crisis, it can solve it as well. That’s why I’m calling on the General Assembly to come back to Raleigh to do their jobs and fully fund North Carolina’s Medicaid program.”
Lawmakers were already scheduled to come back on Nov. 17 to vote on other bills, but Stein, a Democrat, said it was his right under the state’s constitution to call them back for an extra legislative session.
The governor originally made the same plea on Sept. 26, asking both the House and Senate to put aside their differences and come to an agreement before an Oct. 1 deadline, in which Medicaid reimbursement rates would be cut to providers.
That deadline has come and gone, but the arguments on both the governor’s side and the legislature’s remain the same.
Stein said that the North Carolina Department of Health and Human Services (NCDHHS) warned the General Assembly for months about the impending Medicaid shortfall. He said he urged the General Assembly to fill the breach, delaying the proposed cuts for the first three months of this fiscal year.
While each chamber came to its own agreement that Medicaid needed more money, they couldn’t agree on a bill to send to the governor before Oct. 1.
Stein faced sharp criticism for refusing to move his Oct. 1 deadline to fully fund North Carolina’s Medicaid rebase, even though House Speaker Destin Hall, R-Caldwell, said the program has enough money to last into early next year and that Stein and the Department of Health and Human Services have administrative tools to address the gap.
Hall and the chamber’s Health Appropriations chairs issued a press release on Oct. 1, calling the governor’s actions a “political stunt that jeopardizes North Carolinians’ access to health care.”
“Governor Stein’s arbitrary Medicaid cuts are unjustifiable, clearly intended to manufacture a crisis,” Hall said in the press release. “The legislature has given funds to sustain Medicaid well into 2026. This breathtakingly cynical move ignores years of precedent where the rebase has been supplemented even later in the fiscal year.”
On Sept. 23, the House voted 111-0 in favor of passing a House committee substitute bill to SB 403, “Additional Medicaid Funds and Requirements,” that fully funds the Medicaid rebase.
The Senate passed its version of the bill on Sept. 22 after it was discussed in the Senate’s Appropriations/Base Budget Committee.
About $319 million is needed to fully fund the Medicaid rebase, even though both the House and the Senate agreed only $190 million would be needed in their separate bills, based on analysis by the General Assembly’s Fiscal Research Division.
Hall’s office issued a press release on Thursday in response to Stein’s call for an emergency session, stating that “the North Carolina House of Representatives reaffirms its strong commitment to protect patients from the Governor’s politically motivated and unnecessary provider rate cuts.”
The release states that NCDHHS confirmed that, although Medicaid was funded through April 2026, rates were cut on Oct. 1, after the General Assembly appropriated $600 million for the rebase.
Hall said that House lawmakers have already taken decisive, bipartisan action to provide additional funds to the state’s Medicaid rebase, passing three clean, stand-alone bills in recent months to ensure the state meets its obligations to patients and providers, including Senate Bill 403, House Bill 491, and the Healthcare Investment Act, which he said that the Stein administration has indicated that any of them would lead them to drop their cuts.
Looking ahead, Hall said the House remains willing to work collaboratively with the administration to monitor Medicaid spending throughout the fiscal year and, if necessary, appropriate additional funds to close any verified shortfall.
“The House has done its job to fund Medicaid with clean bills and is prepared to do more if needed,” Hall said. “We need to resolve this matter quickly to protect patients, support providers, and ensure the long-term stability of North Carolina’s Medicaid program. Until recently, the General Assembly has worked with the executive branch to provide funding to Medicaid, while also monitoring the program’s integrity. The administration should have continued that practice.”
“Gov. Stein’s self-inflicted ‘crisis’ is not an extraordinary occasion by any measure,” said Lauren Horsch, Spokeswoman for Senate Leader Phil Berger. “Now that the courts have stepped in to block some of his politically motivated cuts, he’s attempting a new stunt to pass the buck. The General Assembly appropriated $600 million to the Medicaid rebase, and instead of prioritizing funding for services, Gov. Stein decided funding bureaucracy was more important.”
At Thursday’s press conference, Stein said he told the legislature that NCDHHS could reverse the cuts if they sent him a bill funding the rebase. While the House sent a clean Medicaid bill to the Senate; the Senate, in turn, rejected it because of an unrelated political dispute. The Senate’s version included funding for The North Carolina Children’s Hospital.
“I agree with the Senate on the substance of that political dispute, but it is absolutely wrong and frankly cruel to use sick and vulnerable people as a bargaining chip on an issue entirely unrelated to Medicaid funding,” the governor stated. “The members of the General Assembly have had six months to take action and solve this problem, but they have failed. They have failed North Carolina, they have failed the people of North Carolina, and now they have packed up and left town ostensibly until next year. It is shameful.”
Stein stated it would be reckless to spend money knowing they would run out of money at some point next year, adding that there are no guarantees the General Assembly will come to an agreement on a budget.
“We’re one of two states in this nation that don’t have a budget this year, but we’re the only state in the nation where the two chambers [that] cannot agree are from the same party,” he said. “What guarantees do we have that they will come up with a budget next year? There are none.”
Stein said there is also the option of using the Medicaid Contingency Fund, but the legislature has stated in law that the governor can’t access it without them giving an additional appropriation.
“I would welcome them changing the law,” he said. “In fact, I suggested to them, modify this law, let us grab that money for this one-time use. It would create a greater fiscal hole going into next year, but at least at that point, we would have had enough money in the account.”
The governor said that the state will keep running into funding gaps because the legislature has doubled down on its tax breaks for big corporations and wealthy residents, Affordable Care Act (ACA) health insurance premiums are going up, and the federal government cut Medicaid by a trillion dollars, which he said will lead to $50 billion in cuts to North Carolina over the next decade.
Stein did say, however, that the state has an “exceptionally well-run Medicaid program,” in that only 2% of all funding goes to Medicaid administration costs and that costs are growing at 25% less than the national average of health care inflation.
The governor stated that as providers close their doors, the inaction of the General Assembly will be felt not just by those on Medicaid, but by everyone.
NCDHHS Secretary Dr. Devdutta “Dev” Sangvai said at this point it’s hard to pinpoint a number of how many providers will close, but some multi-location practices with multiple providers are saying they will close and there may be a domino effect with that.
Editor’s note: This story has been updated.