Final 2023 NC Budget - What it means for social work

The North Carolina General Assembly passed a $30 billion dollar state budget, after a delay of 84 days. The fiscal year began on July 1, 2023. The budget was passed in the NC House 70-40 with (5) Democrats joining Republicans and in the NC Senate along party lines in a vote of 28-19. It was presented to Governor Cooper for his signature on September 22, 2023 and became law without his signature on October 2, 2023.

The Governor released a statement to allow the budget to become law without his signature, explaining, “Make no mistake, overall this is a bad budget that seriously shortchanges our schools, prioritizes power grabs, keeps shady backroom deals secret and blatantly violates the constitution, and many of its provisions will face legal action.

However, we must recognize this irresponsible legislature’s decade of refusal to expand Medicaid, which has caused life and death situations for so many North Carolinians and threatened the very existence of numerous rural hospitals. I will not allow people who are crying for help to wait any longer, so I am directing our Department of Health and Human Services to begin today the process for expanding Medicaid while allowing this budget to become law without my signature."

Click Here to view HB 258: 2023 Appropriations Act.

Click Here to view the Committee Report.

Most notably, the passing of the budget finally expands Medicaid in North Carolina. The NC Department of Health and Human Services announced Medicaid Expansion will begin on December 1,2023. This will give health insurance to over 600,000 additional North Carolinians. NASW-NC has advocated for Medicaid Expansion for over ten years and this was one of our top legislative priorities for 2023.

Read: NC Medicaid Expansion Will Launch on December 1st.

Restoring Master’s Level Pay for School Social Workers was not included in the final budget. This was another top legislative priority for NASW-NC in 2023. NASW-NC will continue to advocate for restoring for Master’s Level Pay for School Social Workers.

The final budget is 625 pages in length. Here is a summary of budget items of interest to North Carolina social workers:

• Raises for teachers, state employees: 4% raise for this fiscal year (retroactive to July 1st) and 3% raise next fiscal year. Beginner teacher pay will increase from $37,000-$39,000 and up to $41,000 next year. More experienced teachers will see smaller pay raises between $1,000-$1,800 per year. Falls very short of increases asked for by Governor Cooper; State Employees Association of NC, and teacher groups.
• State Employee Retirees: One time cost of living supplement of 4% to be paid on or before November 30, 2023.
• Tax cuts: Accelerates planned cuts to the state's personal income tax rate. The state's current rate is 4.99% and will decrease to 4.6% in 2024, 4.25% in 2025 and 3.99% in 2026 and beyond.
• School vouchers: Massive expansion that makes families of all incomes eligible for the voucher and quadruple the program’s to more than $500 million per year by 2031. Funding takes away tax-payers dollars from public-schools, meaning schools in rural and poorer counties will face steep funding cuts, leaving schools without resources.
• Early childhood: No additional funding for Smart Start or other items prioritized for child care programs.
• Free School Lunches: Eliminates student co-payments for reduced-price breakfast and lunches and eliminates any penalties on students such as withholding student records or not allowing a student to participate in graduation or receive a diploma, for unpaid school meal debt.
• Parents Bill of Rights: Extends the implementation of Senate Bill 49 until January 1, 2024.
• Child fatalities: Establishes "The State Office of Child Fatality Prevention" within the Department of Health and Human Services, Division of Public Health, to serve as the lead agency for child fatality prevention in North Carolina.
• Behavioral Health:
  • Increased Provider Rates: Increased rates paid to mental health and substance abuse services providers, to the sum of $130 million over the next 2 years.
  • $40 million over 2 years in bonuses and incentive pay for workers in state psychiatric hospitals (on top of promised raises for state workers).

  • $2 million per year in recurring dollars for the Psychiatry Access Line (NC-PAL), a partnership between DHHS and the Department of Psychiatry & Behavioral Sciences at Duke University. primary care provider or pediatrician, can pick up the phone and speak to behavioral health experts

  • $5 million to advance a collaborative care model — where common mental illnesses are treated in primary care settings, rather than sending patients to another provider

  • $80 million over two years for new mobile crisis teams and for crisis and respite facilities. These are alternatives to the emergency room for people who are experiencing mental health distress.

  • $20 million over two years to fund a non-law enforcement pilot program for transporting patients for voluntary and involuntary psychiatric admissions.

  • $50 million over two years large expansions to the N.C. Loan Repayment program. The loan repayment programs are specifically aimed at recruiting and retaining primary care and behavioral health providers to rural or underserved areas of the states. 

  • $80 million in support services for families with children with mental health needs.
  • $10 million for 350 new slots in the Innovation Waiver program, which provides community-based care for people with intellectual and developmental disabilities.

  • The state budget includes the creation of a statewide specialty Medicaid plan for kids in foster care and their families that aims to streamline their physical and mental health care. The state budget directs DHHS to issue requests for proposals from agencies who wish to hold the contract for the statewide foster care plan, with the new services set to begin by December 2024.

  • $99 million over two years for community-based, pre-arrest diversion programs and programs to help people reentering the community after incarceration. The money will fund local partnerships between law enforcement, counties and behavioral health providers, as well as community-based and detention center-based restoration programs for those with mental illness and substance use disorders.

• LME/MCO Consolidation: The budget directs the Secretary and the Department of Health and Human Services to evaluate proposals to consolidate the six (6) LME/MCOs into four (4) or five (5) LME/MCOs and continue planning for Tailored Plan launch. The consolidation will be decided and begun within 90 days of the budget becoming law. The Department recognizes this approach will accomplish several significant reforms that 1) strengthen the long-term fiscal sustainability of the public system, 2) focuses the health plans to enable better service to individuals, and 3) enhances accountability so that each health plan is more directly tied to individuals’ health outcomes. NCDHHS believes these changes would help the state better meet the needs of people in North Carolina with complex behavioral health conditions, intellectual/developmental disabilities and traumatic brain injury. The new catchment areas will be decided by the Secretary within 90 days of the budget becoming law. 
• Voter ID: The budget provides funding for voter ID implementation.
• Voter fraud: Bans the State Board of Elections from joining a national program aimed at combating voter fraud, called ERIC, which has been targeted by national conservatives after the 2020 elections.
• Public records laws: Allows lawmakers in the future to refuse any records requests they don't want to comply with. State lawmakers have already exempted themselves from some parts of North Carolina's public records laws.
• Repeal Privilege Tax: The budget also repeals the state’s privilege tax on certain professionals (including LCSWs!) effective July 1, 2024. The privilege tax is a state tax imposed for the privilege of carrying on certain business in the state. 
  
• Secret Investigations: Sweeping new powers to a legislative committee to investigate government agencies and private companies that get state funding, and to force anyone involved in the investigation to keep it a secret.
• Crisis Pregnancy Centers: Allocates $20 million dollars to “crisis pregnancy centers” (anti-abortion centers) that target vulnerable patients from accessing abortion and contraception.
• COVID-19: State agencies and governments cannot discriminate against someone on the basis of their COVID-19 vaccination status or willingness to show proof of vaccination, meaning COVID-19 vaccination cannot be mandated either.
• No local minimum wage: Local governments will not be allowed to set their own wage policies, including establishing a minimum wage or mandating companies provide benefits such as paid parental leave or vacation time.
• Guns in courtrooms: Permits Supreme Court justices and Court of Appeals judges to carry concealed weapons in court, a right already afforded to judges sitting in the state’s district and superior courts.

If you have specific questions about the budget, please feel free to reach out to Lauren Zingraff, Director of Advocacy, Policy, and Legislation at advocacy.naswnc@socialworkers.org.