NCHA Statement on Medicaid Proposals in H.R.1

Raleigh, NC – July 3, 2025 — Medicaid is a lifeline for 3 million North Carolinians, including more than 650,000 individuals who gained coverage through expansion. Medicaid also sustains the state’s rural and safety net hospitals that serve low-income families, children, seniors, and individuals with disabilities. 

The U.S. Senate has passed its version of H.R. 1, and the House is expected to vote on the bill today. At the heart of this legislation are critical decisions about how Medicaid is funded. 

This legislation will impose deep cuts to Medicaid in North Carolina and will impose significant financial burdens on state governments to make up for lost federal support. These provisions would effectively dismantle North Carolina’s state directed payment program — the Healthcare Access and Stabilization Program (HASP) — jeopardizing nearly $6.5 billion in total funding — including close to $5 billion in federal dollars — that supports Medicaid expansion and rural hospitals across the state. 

HASP was created to offset the financial gap hospitals face when serving Medicaid patients and to preserve access to care, especially in underserved areas. This legislation, whether through capping provider taxes at 3.5% of net patient revenue or slashing payment rates to 100% of Medicare, would virtually eliminate that benefit. 

The bill’s Rural Health Transformation Program is an inadequate substitute.  

The North Carolina Healthcare Association is urging the rejection of the Senate’s proposed Medicaid cuts in H.R. 1 and to reconsider the original House-passed bill. 

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About North Carolina Healthcare Association

Founded in 1918, the North Carolina Healthcare Association (NCHA) is the united voice of the North Carolina healthcare community. Representing more than 130 hospitals, health systems, physician groups and other healthcare organizations, NCHA works with our members to improve the health of North Carolina communities by advocating for sound public policies and collaborative partnerships and by providing insights, services, support and education to expand access to high quality, efficient, affordable and integrated health care for all North Carolinians.