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How the state spent $1.6 billion in federal Medicaid incentives

When North Carolina agreed to expand Medicaid this year, it came with a special sweetener from the federal government--a signing bonus of $1.6 billion. Lawmakers could spend it on whatever they wanted. So where did it go?

Posted 2023-11-14T21:50:54+00:00 - Updated 2023-11-14T23:42:12+00:00

How NC lawmakers spent $1.6 billion on Medicaid signing bonus

Laura Leslie

, WRAL Capitol Bureau Chief

How do you think the state should spend $1.6 billion? Just about everyone has some ideas.

WRAL interviewed Raleigh residents as they were out shopping Tuesday for theirs.

"They should spend it on education and bettering our system and paying our teachers and educators," said Consuela Martinez at a shopping center in North Raleigh.

Bibi Buchanan agreed. "Anybody who walks through our public schools could very easily pick things that desperately need more funding from the state and from our taxpayer money," she told WRAL News.

"Helping veterans. Helping people that might be in need," said Corey Perry.

Mike Arcari suggested using it to subsidize costs for people who can't afford healthcare.

State lawmakers were free to spend the $1.6 billion Medicaid signing bonus however they wanted, but Gov. Roy Cooper and some house budget-writers argued for spending as much of it as possible on health and mental health. In the final budget, that's where much of it ended up, including:

$105 million for three new rural health centers.
$80 million for mobile health crisis teams and respite care.
$75 million for a new children’s and teens' behavioral health hospital in the triangle.
$40 million for a pay boost for skilled nursing and personal care workers.

Hundreds of millions of dollars more went to universities and community colleges to expand medical, nursing and health sciences programs to increase the healthcare workforce. Hospitals got millions as well.

But some was spent on earmarks that had nothing to do with healthcare.

$5 million for the new Civil War museum in Fayetteville
$4.5 million for a performing arts center for Belmont Abbey College in Gaston County
$3.2 million for a library expansion in Swain County
$300,000 to renovate bathrooms at the Rockingham Dragway in Richmond County

Republican budget-writers said these were legitimate uses of the money, but many Democrats disagreed.

"We could have used that money to benefit everyone in North Carolina, not just specific districts with important projects," said Rep. Wesley Harris, a Charlotte Democrat. "That money has been sprinkled around for pet projects to make other members just look good in their community. That's not why we expanded Medicaid."

State Health and Human Services Secretary Kody Kinsley was not available for an interview, but in a statement, his department said: "The funds from the Medicaid signing bonus were meant to be incredibly flexible to be used as needed."

"This is a monumental step forward in assuring people can receive care when and where they need it," the spokesperson's statement said.

Republican budget-writers were not available for interviews, but a spokesman for Senate Leader Phil Berger, R-Rockingham, said the Senate prioritized health care capital projects, behavioral health and workforce development needs.

"This includes the construction of a new children’s hospital, the creation of the NC Care Initiative between ECU Health and UNC Health, and funding allied health and workforce training capital needs at our community colleges, among other things," Berger spokesman Randy Brechbiel said. "These funds are being put to good use and will bolster North Carolina’s health care landscape as more patients seek care.”