August 15, 2025
On Aug. 13, NC Medicaid informed legislative leaders, health plans and Medicaid providers that the agency will be taking action to make cuts to the program (both service cuts and rate cuts) effective Oct. 1. In their comments, the NC Dept. of Health and Human Services (NCDHHS) blamed the lack of a full rebase from the legislature in a temporary budget measure that was approved about a week ago. As you may know, NCDHHS originally asked for a $700 million rebase (based on January estimates) but more recently said they would need $819 million. The legislature approved a $600 million rebase in their critical needs mini-budget. So, what does all this mean? Significant rate and service reductions.
Providers will see rate reductions of anywhere from 3-10%, with primary care physicians seeing rate cuts of 8%. FQHCs and Rural Health Clinics are at the lowest level of 3%, while inpatient and outpatient hospital services and professional fees will see reductions of 10%.
The NCAFP has already expressed significant concerns to Medicaid Deputy Secretary Jay Ludlam and will continue to advocate for our members and full funding of primary care, which accounts for only about 4% of total provider spend in Medicaid.
Some of the other things Medicaid proposes to cut include:
The NCAFP will remain in contact with the NCDHHS regarding this issue through the coming weeks.
The North Carolina Academy of Family Physicians, Inc. (NCAFP) is a nonprofit professional association headquartered in Raleigh which represents over 4,300 family physicians, family medicine residents, and medical students across the state. It is the largest medical specialty association in North Carolina and is a constituent chapter of the American Academy of Family Physicians, based in Leadwood, KS.
