Rural North Carolina counties would suffer most from Medicaid cuts

A push by Congressional Republicans to slash federal funding for Medicaid could have “dire consequences” for the more than 1.2 million rural North Carolinians who depend on the program.

That was the key takeaway from a report released in January by the Center for Children and Families at the Georgetown University McCourt School of Public Policy. Rural communities, the researchers wrote, are likely to bear the brunt of the cuts being contemplated in Washington because they make up a disproportionately large share of the state’s Medicaid enrollment.

A little over 39 percent of all Medicaid beneficiaries in North Carolina live in rural counties, according to an NC Health News analysis of the latest enrollment data from the state Department of Health and Human Services. A county is considered rural if it has fewer than 250 residents for every square mile of land.

Suburban counties, which are more densely populated, account for nearly 29 percent of the state’s beneficiaries. Urban counties with large cities make up about 32 percent.

Republicans in the U.S. House of Representatives are weighing various options to reduce federal spending on Medicaid in an effort to offset the cost of President Donald Trump’s plan to extend trillions of dollars in expiring tax cuts. But experts say all of the proposals floated so far would most adversely affect the same rural communities that carried Trump to victory in North Carolina.

Trump was the overwhelming favorite among rural voters in the 2024 presidential election, defeating former Democratic Vice President Kamala Harris in 66 of the state’s 78 rural counties. However, NC Health News found that some of those Trump-supporting counties have more residents enrolled in Medicaid than residents who voted, underscoring the program’s importance to rural populations.

In rural Robeson County, for example, Trump was the top vote-getter among the 47,094 residents who cast ballots. Nearly 66,800 people in Robeson — or roughly 57 percent of the county’s population — are covered by Medicaid.

The election happened less than a year after North Carolina became the 40th state to expand access to Medicaid in December 2023. Under expansion, the maximum allowed household income for eligibility increased to 138 percent of the federal poverty level, or just under $36,000 annually for a family of three.

More than 600,000 newly eligible residents have joined the rolls since expansion took effect, swelling the state’s total enrollment to 3 million. NC DHHS has said the majority of people who gained coverage through expansion live in rural counties. Eight out of 10 of the new enrollees are adults with jobs, the statistics show.

“Medicaid is important in every state,” Leonardo Cuello, a research professor at Georgetown, told an audience of North Carolina-based health advocates during a recent webinar. “But man, is it really extra important in states with lots of rural areas.”

Children at risk

While Medicaid is most commonly associated with low-income adults, Erica Palmer Smith, executive director of the advocacy group NC Child, said the program is “vitally important” to children in the state.

“We have so many children who are dependent on the services provided through Medicaid for things as simple as their regular well checks,” she said in an interview with NC Health News. “But also when those children have a medical emergency or when they have a medical need, they don’t have another means for coverage than through our Medicaid program.”

That’s especially true for children in rural areas. Georgetown estimated that 237,800 children in rural North Carolina counties were covered by Medicaid in 2023, which translates to about 30 percent of all children living in rural areas based on population projections by the N.C. Department of Commerce.

“So many families across North Carolina are dependent on Medicaid for their children’s coverage, and so there is a lot of, I think, concern by a lot of those families around what could happen,” Smith said. “We don’t know what’s going to happen, but there is definitely a lot of concern because this is so important to those kids and their families.”

Medicaid begins benefiting many children before they’re even born.

Cuello said about 38 percent of North Carolina’s births are covered by Medicaid. The state, he added, pays less than a third of the $10,000 cost to deliver a baby from a mother enrolled in the program.

“With Medicaid, North Carolina can pay for more than three births with $10,000, so you’re getting three for the price of one,” he said. “Imagine if Medicaid goes away and you still have the same number of births to pay for.”

Hospitals in jeopardy

Cuts to Medicaid could also mean pregnant women in rural counties have fewer places to give birth.

Mark Holmes, director of the Cecil G. Sheps Center for Health Services Research at UNC Chapel Hill, said the program is a major source of funding for the state’s rural hospitals, many of which are struggling financially.

“Without Medicaid, many of these people on Medicaid would be uninsured,” Holmes said in an interview with NC Health News. “Medicaid decreases the uncompensated costs that hospitals are covering. We might call this ‘charity care’ in a more layperson kind of language, but the notion is that if you are sick and you go to the emergency room, they’re going to take care of you. And if you have Medicaid, then hospitals are getting money for it.”

Twelve rural hospitals in North Carolina have either shut down or stopped providing inpatient care since 2005, according to data from the Sheps Center. At least 10 other hospitals in rural parts of the state are at risk of going under.

If they do, residents will be forced to travel farther for essential services. That would exacerbate existing barriers to care for Medicaid beneficiaries in rural counties, who Holmes said “tend to be less able to transport to other locations.”

“They’re more likely to stay and get their care locally, whereas someone who lives in a rural area but has a job an hour away in an urban setting might get their health care there,” he said. “Someone who lives in a rural area who’s on Medicaid may be more likely to get their care locally, and rural hospitals fill that important role for those local populations.”

Cuello said that rural hospitals “rely on Medicaid payments to literally keep the lights on.”

“If you slash Medicaid funding for North Carolina, some of these hospitals that depend on Medicaid reimbursement are going to close, and that has health impacts for people in rural areas who have nowhere else to go,” he said, adding that hospital closures often have a ripple effect on local economies.

Previous research by Holmes has found that rural hospital closures are associated with a per capita income loss of between $703 and $1,300, along with an uptick in local unemployment rates.

“These hospitals are big employers and the economic engines of some of these rural counties,” Cuello said.

Broader concerns

Reduced federal funding for Medicaid could have other ramifications for rural areas.

Cuello noted that the program is the nation’s largest payer for substance use disorder treatment. It allows people in rural counties that have been ravaged by the opioid epidemic to access addiction and recovery services that would otherwise be unavailable to them.

The North Carolina Office of the Chief Medical Examiner reports that in the previous year, rates of opioid overdose fell by about 27 percent in 2024, the year after expansion went into effect.

Medicaid also pays for more than 60 percent of the state’s nursing home stays. That coverage is particularly important for rural populations, which skew older than those of urban and suburban counties.

“Medicare does not, repeat, does not pay for nursing homes,” Cuello said, referring to the similarly named program for older adults and people with disabilities. “It is actually Medicaid that pays for ongoing nursing home needs for seniors and similar placements for people with disabilities.”

Health care isn’t the only thing at stake. North Carolina receives about $14 billion a year from the federal government to run Medicaid, freeing up state dollars for other priorities like education.

Cuello said less than $9 billion of the state’s General Fund is earmarked for Medicaid, while the state pays more than $20 billion on K-12 schools. But that calculus could change if the feds decide to scale back spending on Medicaid.

“All of those federal dollars that are coming in for Medicaid are allowing the state to spend twice as much of its state dollars on education as it does on Medicaid,” he said. “If you take away the federal Medicaid dollars? Yes, that hurts health care, but also education and other state priorities — because how does the state sustain its high spend on education if it loses its biggest source of federal revenue?”

Speaking out

Amber Mosher grew up in a rural North Carolina town about 20 minutes from the nearest hospital.

Her parents, who worked in construction and retail, couldn’t afford health insurance. They relied on Medicaid to pay for Mosher’s health needs.

“It is how I got my vaccinations,” she said. “It’s how I was able to see a doctor when I was sick.”

Now the vice president of health policy at Washington-based communications firm GMMB, Mosher said it is important for Medicaid beneficiaries to share their own experiences with federal lawmakers.

“Sometimes folks can get lost in the sauce when you talk about data and statistics,” she said. “But when you pair that with stories about real people, real health care providers and real small town business owners, it really helps folks understand the real-life impacts of something like cutting federal Medicaid dollars.”

Mosher said GMMB is working with Georgetown to “help folks tell the story of North Carolina and how Medicaid supports your rural communities.” NC Child is also soliciting testimonials from families who have benefited from the program.

The organizations hope that members of the state’s delegation in Washington can be persuaded to remove Medicaid from the chopping block if enough of their constituents speak up.

“Everyone in North Carolina has friends, family, neighbors or coworkers who are being supported by Medicaid right now, whether they know it or not,” Cuello said, adding that people “might not stand for cuts to Medicaid if they understood what Medicaid is doing.”

Dive deeper

NC Health News analyzed data from multiple state agencies and organizations while reporting this story. Check out this spreadsheet for a county-level look at what we found.