By Jaymie Baxley and Jennifer Fernandez
North Carolina’s county social service offices are scrambling to prepare for new Medicaid work requirements — and most are still waiting for guidance from federal officials.
Under H.R. 1, the sweeping federal bill signed last summer by President Donald Trump, the roughly 732,000 North Carolinians who obtained health care coverage through Medicaid expansion must prove they are working, volunteering or attending school at least 80 hours a month to keep their benefits, starting Jan. 1, 2027.
North Carolina is one of just 10 states where Medicaid eligibility determinations are handled locally rather than by state workers, so the burden of implementing those requirements falls almost entirely on counties’ departments of social services. That’s even as about 10 percent of county social services positions dedicated to Medicaid are currently vacant. Federal guidance isn’t expected until June, leaving less than seven months for the state and counties to build new systems, retrain workers and reach hundreds of thousands of beneficiaries.
That challenge will look different in every corner of the state. NC Health News reached out to a dozen counties from Macon in the mountains to Dare on the Outer Banks and heard from a handful willing to share how they are preparing — offices serving barrier island resort towns, tobacco-belt farming communities and a midsize city with pockets of deep poverty. What they described was a system already stretched thin that’s bracing for a wave it’s not sure it can handle.
The tourist economy
Chuck Lycett has been here before — wrestling with the challenge of delivering social services to people scattered over a long, skinny barrier island. Lycett, director of Dare County’s Department of Social Services, learned during the pandemic that geography is a solvable problem. What worries him now is everything else.
Dare County is not a typical North Carolina county. Residents are strung along the Outer Banks, from the Virginia border south to Hatteras 60-odd miles away. A satellite office in Frisco serves the remote southernmost part of the county on Hatteras Island.
Farther north, workers commute from Currituck and Tyrrell counties — an hour each way — to the main office in Manteo, the county seat.
Housing costs make recruiting local workers a challenge. The local economy is built on tourism, in an area dotted by expensive vacation homes and little affordable housing. A substantial share of Dare’s resident workforce spends the summer months in demanding, cash-heavy jobs — sometimes working two or three gigs, clocking more than 40 hours each week and squirreling away the dough. The slack winter season brings something closer to unemployment.
“That was the first thing I thought about,” Lycett said, referring to seasonal workers who start in May, finish by late September and then face a recertification window in January or February with no recent work to show. A twice-yearly recertification cycle means those summer workers could lose Medicaid coverage precisely when there’s no paid work to be had.
The documentation challenge is compounded by the nature of Dare County’s informal economy. About a quarter of the 1,570 local beneficiaries enrolled under Medicaid expansion — the group affected by work requirements — are self-employed. Some receive 1099 tax forms from housecleaning or home inspections. Others live on tips.
Lycett is waiting, along with many others, for the federal Centers for Medicare & Medicaid Services to clarify what verification will require. The General Assembly has made it clear what it wants from that verification: three months of records, no self-attestation of work hours and tallying income from all members of a household — including those who might be undocumented — into the application.
“We are in a holding pattern,” he said.
That uncertainty lands on a department already stretched thin. Lycett runs a staff of about 40, from frontline workers to program managers. On a good day, he estimates an 8 percent vacancy rate — but that metric doesn’t capture a deeper problem.
“I also don’t have staff that have been here long enough to really be trained and efficient,” he said.
Across his three Medicaid units, Lycett’s workers last fall averaged just 11 to 13 months of experience.
The technological infrastructure those workers rely on is a decade old. NC FAST, the state’s system for assessing Medicaid eligibility and managing cases, was built in an era before AI-assisted processing, automated recertification triggers or digital document portals. Those tools could free caseworkers to focus on the complicated cases that work requirements will multiply.
In the meantime, Dare County is thinking practically.
The department has considered installing kiosks at the Frisco office where beneficiaries could scan and submit documents without making the hour-plus drive. In places like Stumpy Point — 30 to 40 miles to the southwest, where some families run fishing or crabbing operations and rarely make it to Manteo — staff will go visit residents if necessary.
“There are no barriers if people want to apply,” Lycett said.
What he can’t solve is the administrative pressure — the audits, accuracy requirements and sheer volume of manual verification that work requirements will add. Even if every vacancy were filled tomorrow, Lycett said, the county would face a capacity problem.
“The pressure has to be released somewhere,” he said, adding there are probably not “enough potential employees in Dare County to fill all the vacancies” at his agency.
Lycett sees one silver lining: Volunteer work at food pantries, thrift stores and nonprofits could count toward compliance requirements during the off season, potentially benefitting local community organizations.
That will bring its own set of problems, though, where those often thinly staffed organizations will have to track and verify those hours.
Generational poverty in a farming area
In her four-decade career as a social worker, Kimberly Irvine has seen how the population that relies on Medicaid and food assistance contrasts with the caricature of fraud and dependency that often animates policy debates and online chat rooms.
She ticked through the profiles: single parents juggling work and a child with a disability; people with mental health or substance use issues; workers whose hours vary too much from month to month to reliably document what is required to qualify for insurance.
“The widespread fraud — I’m just not seeing it,” said Irvine, director of the Wilson County Department of Social Services.
Medicaid fraud occurs, but it’s usually committed by providers, not beneficiaries. The North Carolina Department of Justice’s Medicaid Investigations Division has uncovered multiple cases of fraud by providers in recent years.
After work requirements take effect, caseworkers who now determine eligibility will also have to track compliance, navigate verification for nontraditional employment and manage the friction of informing beneficiaries that their coverage is at risk.
The caseload may decrease somewhat, but each case will require more oversight, Irvine said. “It’s going to be more complicated to keep up.”
The large number of agricultural workers in the county are a particular challenge, as many farm workers are paid off the books. In the past, farm workers could attest to the hours they worked; the new law passed by the General Assembly removes that option.
Irvine echoes Lycett’s wish for a modernized state benefits system with multilingual support, real-time error detection that flags inconsistencies early, and seamless data-sharing with vital records, tax systems and unemployment databases.
Those will cost money — and the financial calculus is stark for Wilson County, whose unemployment rate is seventh highest among the states’ 100 counties. Wilson’s poverty rate is 17.6 percent, compared with 12.5 percent for the state, census data show.
Congress also changed the cost-sharing rules around federal food aid in the new law. Irvine said that will mean roughly $866,000 more in costs for Wilson County in the first eight months of the fiscal year. The county’s total local DSS budget is about $13 million; the federal changes will increase the local share by nearly 10 percent, with no new funding from the state starting in 2028. The federal government can impose financial penalties for a high payment error rate that the state would pass down to localities. Wilson County’s portion of penalties could reach $4.2 million, Irvine said.
She said no state relief has been offered for county governments’ share.
Her deepest concern isn’t fiscal, though. It’s about who falls off the rolls when the new Medicaid work requirements hit already fragile populations.
“It’s a lot to try to understand,” Irvine said. “I can see them being frustrated and not being able to manage the requirements.”
The department’s caseworkers, she added, won’t have the bandwidth to walk clients through the process individually. They’re already at capacity. Irvine’s department currently has four vacancies, with two in Medicaid, putting it near the 10 percent statewide rate.
What she wants legislators to hear, above all, is that the people most likely to lose coverage are not gaming the system, she said. They’re working, or trying to, under conditions most policymakers have never encountered.
“I think we may have more people that are homeless and desperate [as a result of the requirements],” Irvine said. “And when people are desperate, that can sometimes drive up the crime rates because they’re not getting their basic needs met.”
An urban county with great needs
The month after the federal tax and spending bill passed, Guilford County leaders and community members started working on ways to address the new work requirements.
“This is going to affect a lot of our citizens, and especially our vulnerable citizens” who are homeless or lack housing or transportation, said Sherri Malpass, program manager with Guilford County Department of Social Services, based in Greensboro, the state’s third largest city.
“We wanted to start right away,” she added, “reaching out and creating pathways for those populations to be able to maintain benefits.”
There are already systems in place to track work and school hours, Malpass said, but not volunteer hours.
The Guilford Nonprofit Consortium and Hands On NWNC plan to provide opportunities in their volunteer matching platform that would let Medicaid and SNAP recipients meet the volunteer hours, if they’re not working for pay, Malpass said. The groups are working to create a way to verify those volunteer hours.
An initial stakeholder meeting in October 2025 drew about 80 people from 37 organizations, according to Tina Fisher, who leads Friends in Action, a social action group within New Garden Friends Meeting in Greensboro, which organized the stakeholder meeting.
“People are so relieved to be doing something,” said Brenda Esch, pastoral minister at New Garden Friends Meeting.
Friends in Action has focused on supporting DSS workers. An example is promoting the DSS-8209, a little-used form that indicates a person’s inability to work due to a medical condition. The group seeks to automate it so the form goes from a patient’s electronic health record directly to DSS.
Guilford DSS provides multiple access points for people to apply for Medicaid, including DSS offices in Greensboro and High Point, libraries, county offices, church centers and sites like the Tiny House HOPE Center.
On a March morning, seated at their corner table at the Tiny House HOPE Center, Guilford County DSS workers Brittany Scott and Marie Lee said despite what’s at stake, no one had been asking about the new work requirements.
As more questions start to arise, DSS outreach workers will benefit from the connections they made during Medicaid expansion, Malpass said.
“We went to where people were,” she said. “We collaborated with community partners who had those relationships, who had built that trust, and we went out and got them to vouch for us.”
Expansion allowed more than 46,000 Guilford County residents to get health care, including nearly 14 percent of adults ages 19 to 64, state data shows.
But there are still a lot of unknowns.
Erica Reeves, Guilford County DSS Division director for health benefits, said many people who lose Medicaid will turn around and reapply, which will add to the staff workload on top of the more frequent recertifications.
Reeves said she’s worried that people facing new work requirements will become discouraged and give up, going without Medicaid or any coverage.
By some estimates, at least 22 percent of those on Medicaid expansion in North Carolina could lose coverage for failing to meet the new requirements. That would mean about 10,180 people in Guilford County.
Malpass said she hates to think that all the outreach work Guilford County has done since expansion is in jeopardy.
“That’s what made us want to jump in with both feet before even the policy was dry on the paper — to go in and ensure that those hard-won benefits for our clients that are at risk don’t get lost,” she said.
About this series
NC Health News reporters, with support from Public Health Watch, reached out to about a dozen counties across the state to discuss the impact of the new Medicaid work requirements. We conducted multiple interviews and spent several hours with county social workers to find out how they are preparing for the changes.
Read the previous story: North Carolina prepares for new work requirements that will affect the about 732,000 beneficiaries who received coverage through Medicaid expansion.
Coming Monday: Guilford County’s Orange Card program helps people access care when they don’t qualify for Medicaid or other health insurance.
This story is part of “Uninsured in America,” a project led by Public Health Watch, a nonprofit newsroom based in Texas. The project focuses on life in America’s health-coverage gaps and the impact of potential Medicaid and related cuts.
The post Looming Medicaid work rules bring big challenges to NC counties appeared first on North Carolina Health News.
