Federal health cuts could hit rural North Carolina hard

The GOP policy bill in Congress right now could make sweeping changes to Medicaid — the joint federal-state health insurance program for 70 million low-income and disabled people across the U.S. This could reverse gains in the most recent state that expanded coverage: North Carolina.

Family physician Shannon Dowler said Medicaid has been a game changer for her patients in the rural western part of the state.

"I cared for a farmer," she said, "a gentleman in his late 30s who had a terrible leg ulceration that would not heal."

He couldn't afford the care and medicine he needed. That is, until he got coverage when the state expanded Medicaid in 2023.

"He went from being someone at risk for having his leg amputated and being on permanent disability to someone who is fully back to work on his farm," Dowler said.

Covering an additional 660,000 North Carolinians also injects federal dollars into the state's economy — an estimated $8 billion each year. Brian Floyd is COO for the nine-hospital ECU Health system in the rural eastern part of the state.

"It is purely a lifeline," Floyd said of Medicaid funds, which helped shore up finances. "It means the difference between red and black ink."

Floyd was working on plans to reopen a shuttered emergency room in a remote corner of eastern North Carolina. But the budget bill has thrown all this into question.

The changes Congress is considering puts hundreds of rural hospitals across the country in precarious positions. In North Carolina, it would erase all the Medicaid expansion and raise the price of private insurance on healthcare.gov, making it unaffordable for another 250,000 people.

Former North Carolina Secretary of Health Kody Kinsley warns rural areas would be hardest hit.

"People are just feeling frustrated about how that's kind of a punch in the gut," said Kinsley, now a senior policy adviser with Johns Hopkins University. Kinsley worries about the ripple effects on rural doctors, nurses and other health care workers.

"It means that people lose employment that sustains them and their families in those communities," he said, "and therefore lose their ability to spend money and support local businesses."

Still, Michael Cannon, director of health policy studies at the libertarian think tank the Cato Institute, said the tweaks lawmakers are floating now don't go far enough.

"I think our Medicaid problems are going to get worse before they get better," Cannon said.

He thinks Congress should cut Medicaid spending — but he also thinks it should do so more radically and shift who controls health care dollars from the government to consumers. "It's only then that the health sector will start giving consumers higher quality health care at a lower price," Cannon said.

That's not on the table right now. The reality of the cuts that are on the table means millions will lose coverage but still need care.