NC officials seek help implementing new federal SNAP, Medicaid eligibility requirements

State and county officials say they are preparing to implement new federal work requirements for North Carolinians seeking food stamps and Medicaid coverage. But they need more time and money to comply with the law, the officials told legislators Tuesday.

President Donald Trump last year signed legislation — known as the “One Big Beautiful Bill” — that shifts some of the cost burden of the programs from the federal government to states. The legislation also tightens eligibility requirements for the programs and requires more applicants to prove they’re searching for employment.

Cuts and changes to the programs are meant to offset a drop in tax revenue. The new federal legislation is expected to add trillions of dollars to the national deficit over the coming decade to pay for new tax cuts, according to the nonpartisan Congressional Budget Office. The plan to cut SNAP funding by 20% is the largest cut to the program ever, according to analysis by the Harvard Kennedy School of Government. 

Of North Carolina’s roughly 11 million residents, more than 3 million are on Medicaid and another 1.4 million are on food stamps, although there’s some overlap between the two groups.

North Carolina legislators summoned state and county health officials to hearings in Raleigh Tuesday for an update on how they’re preparing to enforce the new laws. County governments — which administer the programs — are still unsure how they’ll pay for additional Medicaid costs, said Kevin Leonard, executive director of the North Carolina Association of County Commissioners. 

The new law “is one of the most significant unfunded mandates and one of the largest shifts of administrative and economic responsibility that our state and our counties have seen in generations,” Leonard said. The law requires states to begin implementing many of the Medicaid changes in January 2027. Leonard asked legislators to postpone the deadlines. 

States and county governments could face financial consequences if they struggle to implement new rules for the nation’s Supplemental Nutrition Assistance Program, known as SNAP. Starting next year, the new law will require states to pay for up to 15% of SNAP benefit costs if administrators commit errors in more than 6% of cases. 

Brunswick County has an error rate below 6%, said Robby Hall, the county’s director of social services. But some counties may need help complying with the new law, he said. County governments could be on the hook for a combined $69 million starting in October, according to state data. 

“We have to make sure that our counties don’t bear all the brunt of this,” Hall said. “Those rural communities and some of the others that you’re seeing, they’re going to really struggle to meet these requirements, especially with any funding costs that go on top of that.”

‘Too much work’

The new law targets Medicaid recipients who receive benefits through their state’s expansion of the program. North Carolina expanded its Medicaid coverage in 2023 to nearly 700,000 people who work jobs that don’t offer health insurance and also don’t pay enough to afford private insurance, such as those in the retail and service industries. The new law requires many of those beneficiaries to perform community service at least 80 hours a month or be enrolled in school at least half-time to continue receiving coverage. 

It also requires local officials to check on the beneficiaries twice a year, rather than once a year. 

The state’s Medicaid administrators will likely need an additional $31.2 million per year to conduct the required eligibility determinations, said Melanie Bush, the assistant secretary overseeing the state’s Medicaid program. The state’s program will need an additional $13.2 million for ongoing administrative costs, as well as a one-time infusion of $6.5 million to help with start-up costs, Bush said.

The state’s Medicaid program is already facing a funding shortfall. Health officials said legislators needed to approve $819 million in Medicaid funds for the fiscal year that started in July. State lawmakers supplied only $600 million, saying they wanted to investigate why additional funding is needed. The additional funding never came, prompting a legal battle between Democratic Gov. Josh Stein and Republicans who control the state legislature over how the state’s Medicaid program should budget for a funding shortfall.

State Medicaid officials said they would need the additional $50 million by the end of March to start implementing the new law next January. However, legislators don’t plan to return to Raleigh until the spring. State Rep. Donny Lambeth, R-Forsyth, said legislators need more time to find the money and county officials need more time to prepare for the changes.

There’s “too much work to do, and I just don't see how we can do it” by the deadline, Lambeth told WRAL.

‘Increased complexity’ 

The new law could affect 107,000 North Carolinians enrolled in the state’s SNAP program, said Mike Leighs, the deputy secretary for opportunity and wellbeing at the state Department of Health and Human Services. The new law expands the age range for people who must meet the program’s work requirements from those under 55-years-old to anyone under 65-years-old. It also eliminates exceptions to the work requirements for veterans, people experiencing homelessness and children between the ages of 15 and 18. 

The law also increases state governments’ share of administrative costs from 50% to 75% and introduces a system where states are required to pay a percentage of the SNAP benefit costs if their systems aren’t efficient enough.

Under the new rule, which starts in October 2027, states can avoid paying a cost of the benefits so long as their error rates are below 6%. States with error rates between 6% and 8% will be required to pay for 5% of the costs. States with error rates between 8% and 10% will have to pay 10% of benefit costs. States with error rates over 10% will have to pay 15% of benefit costs. 

North Carolina’s error rate for the 2024 fiscal year was 10.21% but is trending downward, Leighs told lawmakers. Through August, Leighs said North Carolina’s preliminary error rate was 7.05%. 

“There’s really good news to report: So far, we have made significant progress in federal fiscal year [20]25,” Leighs said. However, Leighs said errors rates tend to rise as local administrators adapt to new federal rules. “When we have seen increased complexity added to the program, we have seen a tendency for the error rates to climb,” he said. “That’s a headwind I just want to be transparent about.”

State Sen. Jim Burgin, R-Harnett, said he is concerned that county officials are the ones responsible for finding SNAP beneficiaries who are no longer eligible. “I've already had counties calling me, saying, 'We need more help; we need to hire people,'” Burgin said. “The counties just don't have the funds to do it right now.”

WRAL reporters Destinee Patterson, Megan Cloherty and Will Doran contributed to this report.