Stein signs $319M Medicaid bill, averting shortfall

Buncombe Rep. Eric Ager said his new bill, House Bill 1057, was drafted in response to rising food and grocery prices.

“Wages have just not kept up with the cost of basic necessities,” said Ager. “The same basket of groceries – cost goes up, same paycheck stretches less.”

The bill, titled the Affordable Food Act, would direct the Department of Health and Human Services to seek a waiver from the U.S. Department of Agriculture authorizing a nutrition incentive program to help families buy more fresh fruits and vegetables.

Ager said the measure also aimed to address food deserts. U.S. Department of Agriculture data identified 11 food deserts in Buncombe County, which Ager said affected about 23,000 residents in his district.

House Bill 1057 would support mobile markets, food banks, nonprofits, local governments, and food co-ops serving underserved areas.

“The grant program in this bill would help us bring food to the communities that need it most,” Ager said.

Rep. Ray Jeffers, a Person County farmer, said the legislation would create a farmer stabilization program within the North Carolina Department of Agriculture to buy food grown or processed in North Carolina for distribution to public and nonprofit food assistance programs.

Jeffers said small, mid-sized, and historically underserved producers are more likely to remain in agriculture if they have reliable buyers. The bill also set aside $47 million in recurring funds for farmland preservation. North Carolina is losing 100,000 acres of farmland and forest land a year.

Rep. Garland Pierce, D-Scotland, said he signed onto the bill because a significant portion of his district includes Fort Bragg. The bill’s proposed Targeted Military and Veteran Food Assistance Program would provide $140 million in recurring funds to address food insecurity among military members, veterans, and military families.

According to a 2023 study conducted for the Military Family Advisory Network, 1 in 5 military and veteran families reported some level of food insecurity.

The bill would also prohibit retail grocery stores from using dynamic pricing, which allows electronic price tags to change based on demand, time of day, and other market conditions. Ager said the practice makes it harder for shoppers to plan and budget.

Earlier this month, Maryland became the first state to ban dynamic pricing, including the use of consumers’ personal data to set prices for goods or services.

Ager said the bill carries a significant fiscal note, but he hopes to win bipartisan support as the state budget is written.

Gov. Josh Stein signed a bill Thursday approving $319 million in Medicaid funding after state health officials warned the program could run out of money by the end of May without a state budget.

Before signing House Bill 696, Stein said lawmakers should provide recurring funding next year to keep the program stable.

“For months, the status of Medicaid in North Carolina has been in unnecessary jeopardy,” Stein said. “I’m relieved to say that the bill that I will be signing will provide certainty and care that the people and the providers of this state need and deserve.”

House and Senate lawmakers passed House Bill 696, titled “Medicaid & HHS Adjust./Other Critical Needs,” nearly unanimously earlier this week.

Three Democrats in each chamber voted against it, saying it would deny Medicaid coverage to 27,000 pregnant women and their children because of immigration status. They said the group includes victims of human trafficking, green card holders, refugees, other immigrants with legal status, and undocumented immigrants who are pregnant or recently gave birth.

Stein said he was concerned about that provision, but cited the urgency of funding the program.

“Depriving these vulnerable women and children healthcare converge is wrong,” Stein said. “Fortunately, based on conversations we’ve had, I believe that it is the General Assembly’s intention to fix this.”

The bill also creates new Medicaid copays at the maximum amount allowed under federal law. A coalition of 14 nonpartisan organizations, including the American Cancer Society Cancer Action Network, urged policymakers to reconsider the amounts.

“Research has shown that even low levels of cost-sharing and copayments deter patients from seeking care,” the coalition said.

The measure also requires Medicaid to verify three months of work eligibility before approving applicants, though federal law requires a minimum one-month lookback period. Stein said some eligible people could be denied benefits because of the longer review.

Sen. Benton Sawrey, R-Johnston, said Medicaid faces a $1 billion cost increase in the next fiscal year, larger than the expected state budget surplus. He said costs have risen by more than 90% over the past five years in North Carolina.

The law also includes measures aimed at waste and abuse in Medicaid. Stein said he was not concerned about questions over enforcement authority and said state agencies already work together on fraud cases.