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Dear NC Medicaid Community Partners,
The North Carolina Department of Health and Human Services (NCDHHS) remains committed to transparency, collaboration, and fiscal responsibility in administration of the NC Medicaid program. This email is to inform you of upcoming provider reimbursement rate reductions that are scheduled to take effect on October 1, 2025. NCDHHS recognizes the significant impact these changes may have on you and the individuals and families you serve. NCDHHS deeply regrets that North Carolina General Assembly (NCGA) has failed to appropriate the necessary funding to avoid these cuts.
Despite the Senate and House each passing its own bill to provide additional funding for the Medicaid rebase on September 22nd and September 23rd, they failed to come to an agreement. As a result of the unresolved $319 million shortfall in the Medicaid program, these reductions are necessary to ensure that the NC Medicaid program remains within the funding levels currently appropriated by the North Carolina General Assembly (NCGA).
Please be advised that should the NCGA appropriate and allocate additional funding to support the Medicaid program shortly, the Department will take action to reverse course rates on provider rate reductions and will promptly make and notify you of adjustments to rates appearing on the fee schedules effective October 1, 2025. If the NCGA acts quickly, these provider rate cuts can be reversed.
Key Details:
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Effective Date: October 1, 2025
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Scope: Reductions apply to specific procedure codes, which may appear on multiple fee schedules
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Rate Reduction Percentages: Affected services and corresponding reduction percentages will be listed in the official Fee Schedules published to the Department’s Covered Codes and Fee Schedules portal
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Reduction percentages for certain services not on a Fee Schedule: Rates for Innovations Waiver, TBI Waiver, 1915(i), Non-emergency Medical Transportation (NEMT) services and rates for Psychiatric Residential Treatment Facility (PRTF) services are subject to reduction
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Reductions to Medical Home Fees and Certain Care Management rates: Medical Home Fee(s), Care Management for At-Risk Children (CMARC) services, and Care Management for High Risk Pregnant Women (CMHRP) services are subject to a 3% reduction
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Rate Reductions under Managed Care: Managed care plan capitation rates will reflect the provider reimbursement reductions noted above.
We understand the negative impact these changes may have and are committed to working with providers and stakeholders to ensure a smooth transition. We remain committed to and will continue to work with the NCGA to emphasize the importance of adequately funding the Medicaid Program for the people of North Carolina and its health care providers.
Additional guidance can be found on the NC Medicaid provider bulletin webpage as available. The updated fee schedules will be published to the NC Medicaid Covered Codes and Fee Schedules Portal on October 1, 2025.
If you have additional questions regarding the fee schedule changes or the date on which fee schedules will be available, please contact the DHB Provider Reimbursement Team at medicaid.providerreimbursement@dhhs.nc.gov.
Thank you for your continued partnership and dedication to serving North Carolina’s Medicaid beneficiaries.
Sincerely,
Kelly
Kelly Crosbie, MSW, LCSW
(she/her)
Director
Division of Mental Health, Developmental Disabilities, and Substance Use Services
North Carolina Department of Health and Human Services
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