$33 Million Budget Shortfall Leads To Widespread Layoffs In Medicaid Ombudsman Program

By Andrew R. Jones

Asheville Watchdog

Nearly 40 labor connected to North Carolina’s Medicaid Ombudsman program, including 9 astatine Pisgah Legal Services, will suffer their jobs by nan extremity of nan twelvemonth because of a $33 cardinal shortfall successful nan state’s Medicaid Managed Care Oversight Fund. 

The Medicaid Ombudsman program, which connects thousands of beneficiaries to resources and proposal and which Legal Aid of North Carolina has tally since 2021 for nan state’s Department of Health and Human Services, will move to NCDHHS’ Division of Health Benefits connected Jan. 1, section officials told Asheville Watchdog. 

“Due to underfunding of nan Medicaid Oversight Fund, cuts abstracted from nan Medicaid rebase shortfall, nan NC Medicaid Ombudsman statement pinch Legal Aid of North Carolina (LANC) will extremity connected December 31, 2025, without renewal,” NCDHHS spokesperson James Werner said, adding that Medicaid Ombudsman unit astatine LANC were informed of nan alteration Aug. 26. 

Though NCDHHS said it is readying a modulation to guarantee basal services would proceed pinch “minimal disruptions,” it could not opportunity really galore group would beryllium moving connected nan programme successful nan future.

“At this time, circumstantial specifications regarding nan number of Division of Health Benefits employees’ moving pinch nan Medicaid Ombudsman programme are not yet available, arsenic programme operations are presently nether development,” said Summer Tonizzo, different NCDHHS spokesperson.

Jaclyn Kiger, executive head of Pisgah Legal Services, which has been a subcontractor for nan Medicaid Ombudsman program, said she worries nan alteration will mean cuts to nan program’s severely needed services. 

Pisgah Legal Services employed 9 group arsenic a subcontractor nether nan Medicaid Ombudsman program. “I interest astir each nan group who are connected Medicaid and will request this assistance successful a clip erstwhile it feels like, again, Medicaid is being gutted successful galore different ways,” Executive Director Jaclyn Kiger said. Credit: Andrew R. Jones

“I interest astir each nan group who are connected Medicaid and will request this assistance successful a clip erstwhile it feels like, again, Medicaid is being gutted successful galore different ways,” Kiger said. “That’s erstwhile group request a programme for illustration this, and they request Pisgah much than ever. And america being a portion of this was besides making judge that group were connected to Pisgah erstwhile appropriate, too.”

In summation to nan nonaccomplishment of Medicaid Ombusdan workers, which was first reported successful the Asheville Citizen Times, Pisgah Legal Services will besides laic disconnected 3 labor who helped supply services related to the Healthy Opportunities Pilot, which will beryllium disbanded, Kiger said. That Medicaid programme provided non-medical assistance specified arsenic nutrient and proscription to beneficiaries and was recovered to beryllium effective in a preliminary U.S. Centers for Medicaid and Medicare Services assessment. But a spending scheme projected by nan North Carolina House of Representatives successful May did not include sufficient backing for nan programme to continue.

All told, nan cuts correspond astir a 10 percent unit alteration for nan unit of astir 130 astatine Pisgah Legal, Kiger said.

LANC Executive Director Ashley Campbell said labor moving connected nan programme would suffer their jobs connected Dec. 31. The lion’s stock of nan losses will beryllium astatine Raleigh-based LANC, and successful summation to Pisgah’s losses, nan Charlotte Center for Legal Advocacy will suffer 9 positions.

Since its inception successful 2021, nan Medicaid Ombudsman program, which helps group get entree to Medicaid and link to resources specified arsenic ineligible aid, societal services, housing, nutrient assistance and different programs, has opened 68,825 cases and has had 194,307 interactions pinch beneficiaries, said Tonizzo.

In 2024 alone, nan Ombudsman-affiliated squad astatine Pisgah Legal Services served 4,370 residents, Kiger said. That squad focused connected section outreach, but took calls from beneficiaries crossed nan state.  

“I can’t remark connected what nan authorities plans to do, which is move it internally, but I tin show you that this was an fantabulous squad that did life changing and life-saving activity present successful our region,” Kiger said.

Charlotte Center for Legal Advocacy Chief Operating Officer Cassidy Estes-Rogers said it was frustrating to spot an effective strategy suffer funding.

“I deliberation nan vexation present is that erstwhile we cognize we person a strategy that’s moving for North Carolinians, that we don’t money it successful a measurement that it needs to beryllium funded,” Estes-Rogers said.

‘A superior setback’

In August, North Carolina lawmakers passed a stopgap spending scheme besides known arsenic a “mini budget” that was signed into rule by Gov. Josh Stein that day. That scheme included $600 cardinal for nan Medicaid rebase — nan magnitude required to support existent work levels for beneficiaries — and nan Medicaid Managed Care Oversight Fund.

NCDHHS asked lawmakers for $115 cardinal for nan Oversight Fund but received only $82 million, creating a $33 cardinal shortfall.

“Despite observant efforts by NCDHHS to debar disruptions to service, afloat backing nan rebase is basal to support nan existent level of attraction crossed nan state,” NCDHHS stated successful an Aug. 6 news release about nan underfunding. “To stay wrong budget, NCDHHS now has 2 options to reside a shortfall from an insufficient rebase; trim optional services and/or trim supplier rates.” 

In nan release, NCDHHS Secretary Dev Sangvai said underfunding NC Medicaid was “a superior setback,” and perchance a “fundamental erosion” of nan state’s recently expanded Medicaid program. 

“The forced cuts from nan fund shortfall frighten attraction for those who request it astir and see immoderate of North Carolina’s astir susceptible populations,” Sangvai said.

The agency informed LANC’s Campbell of nan alteration successful an Aug. 26 missive obtained by The Watchdog. 

“The Department greatly appreciates your business and willingness to support nan beneficiaries of nan NC Medicaid Program,” nan missive said. “This Program is important for providing beneficiaries pinch nan basal assistance and education; therefore, operations will beryllium transferred to nan Division of Health Benefits. We regret immoderate inconvenience this whitethorn origin and are committed to ensuring a soft transition.” 

While location was nary guarantee that nan statement pinch LANC would beryllium renewed, some Campbell and Kiger said nan news was unexpected. 

“I’m devastated and frustrated, to put it mildly,” Kiger said. “It is incredibly difficult to laic disconnected group astatine immoderate point, arsenic an executive director. To person to do truthful erstwhile my full squad has been dealing pinch and surviving done Helene and providing conscionable a captious work is really, really difficult correct now. I’m disappointment that Medicaid is not being funded adequately by authorities lawmakers, and that group present successful occidental North Carolina and crossed nan authorities are going to suffer their jobs because of it.” 

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Asheville Watchdog is a nonprofit news squad producing stories that matter to Asheville and Buncombe County. Andrew R. Jones is simply a Watchdog investigative reporter. Email arjones@avlwatchdog.org. The Watchdog’s section reporting is made imaginable by donations from nan community. To show your support for this captious nationalist work spell toavlwatchdog.org/support-our-publication/.

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