How Doctor Billing Malpractice Paralyzes Medicaid Expansion in N.C.

A map showing U.S. states that have adopted Medicaid expansion (blue) and the 12 that have not (orange) since the Affordable Care Act took effect in 2010. Source.

North Carolina is a diverse state – it is home to progressive strongholds and conservative hubs, along with bright cities and rural towns. Yet, its polarization has paralyzed healthcare. North Carolina has been in a seven-year gridlock regarding its policy of Medicaid. The expansion of Medicaid was virtually unthinkable during the governance of Pat McCrory and has been facing obstacles between Governor Roy Cooper and the Republican-controlled state legislature.

In 2014, NC state auditors discovered that a surprising amount of N.C. doctors whose licenses had been revoked were seeing Medicaid patients. Nearly seven years later, another audit revealed the same: North Carolina’s Department of Health and Human Services (DHHS) failed to properly verify credentials, which resulted in improper Medicaid payments. Because of improper Medicaid spending and the state’s failure to expand Medicaid, Affordable Care Act (Obamacare) subsidies are inaccessible to many North Carolinians, as subsidies from the Bill rely on the expansion of Medicaid within states. 

The latest audit revealed that only a few out of the 191 approved Medicaid providers in the sample held verified credentials for Medicaid services. Six of the unverified providers even lacked professional credentials, which resulted in $11.2 million in Medicaid spending to the ineligible providers. Secretary Mandy Cohen of the DHHS agreed with the auditors’ findings that the state should respond to the fraud crisis by revoking the licenses of doctors who offer Medicaid services without adequate credentials. Cohen also suggested that more manual reviews of medical licenses are to be expected. According to Cohen, the DHHS will be coming out with an improved online credentialing program by 2023.

North Carolina is one of twelve states nationally that has not expanded Medicaid since the Affordable Care Act was enacted in 2010. The state’s lack of expansion can be attributed in large part to the mishandling of the Medicaid budget. Without proper Medicaid procedures and budgeting, license verification is difficult and can lead to millions of misallocated dollars as a result. President Biden’s American Rescue Plan, which was recently passed in both the House and Senate, introduces an incentive for states to expand public coverage through Medicaid. However, this incentive is not mandatory, and it is unclear if any states will take it.

The North Carolina state legislature must expand Medicaid as budget expansion is the only way to truly ensure proper credentials and coverage. Additionally, expanding Medicaid would create more than 37,000 new jobs in the state and increase business activity by $11.7 billion by 2022. This is money that can be spent on important issues such as education and infrastructure. Ultimately, Medicaid expansion will result in coverage of the insured, less improper budgeting, and economic stimulation.