By Anne Blythe
When Gov. Josh Stein rolled out his first budget proposal this week, he presented a $33.65 billion spending plan for lawmakers to consider that he said was “delivering on the promise of North Carolina — that where you come from should never limit how far you can go.”
Stein, a Democrat who served as attorney general for the past eight years and a legislator in the General Assembly before that, noted that such a commitment includes health care.
“We have to invest in strengthening our families and lowering costs,” Stein told reporters at a briefing Wednesday. “Too many families can’t afford bare necessities like groceries, housing, health care. So we have to lower costs whenever we can.”
Stein warned of a fiscal revenue cliff that he sees the state approaching if some income and corporate tax cuts favored and pushed through by the Republican-led General Assembly go into effect. He urged lawmakers to delay those cuts, which he said overwhelmingly benefit the wealthy and corporate shareholders who live outside North Carolina — and even outside the country in some cases.
Instead, Stein recommended a child tax credit and cuts for families with low to moderate incomes that could work out to as much as $1,600 for some workers.
Making child care more affordable for North Carolinians was a theme woven throughout Stein’s spending proposal, as was looking for ways the state could help alleviate the health care workforce shortage that many facilities are struggling to overcome.
On the child care front, Stein recommended:
- Increasing the state subsidy rates for child care centers by as much as 13 percent so they could pay workers more.
- Adding 1,000 slots to pre-K across North Carolina “so that more kids show up in kindergarten ready to learn.”
- Creating more summertime enrichment programs before kindergarten for those children “so they are really ready on that first day of school.”
North Carolina child care centers have been struggling to survive for several years. Many saw their enrollment numbers drop during the pandemic. Even with an infusion of federal money to help stave off some of those impacts, some centers struggled to keep their doors open. As that support was phased out last year, and centers started to close, child care advocates cautioned about a funding crisis ahead.
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Investing in health care workers
Kristin Walker, state budget director with the Office of State Budget and Management, told reporters at the governor’s briefing that there were 80 fewer child care centers now than there were a year ago.
Stein hopes to reverse that trend.
“When we invest in the youngest North Carolinians, we set them up for a lifetime of educational success,” Stein said. “We also help parents who want to stay in the workforce. It’s counterintuitive that too many North Carolinians cannot afford to go to work. That’s because they can’t afford child care if they can find it at all. Getting pushed out of the workforce hurts our workers and hurts our businesses and the economy to the tune of approximately $5 billion a year in lost economic activity.”
Some of Stein’s proposals to make a dent in the health care workforce shortages include:
- Investing $5 million to improve the recruitment and retention of direct support professionals who help people with disabilities participate in their communities.
- Spending nearly $20 million to increase the rates of primary care and OB-GYN providers in the state’s Medicaid program.
- Allocating $10 million in the first year of his two-year proposal to the North Carolina Independent Colleges and Universities to strengthen the nursing workforce and increase the number of other nurses and other high-demand health professionals such as physician assistants and physical trainers. That money could come on top of investments in community colleges that the legislature appropriated in the 2023 budget to address long-term health care personnel shortages across the state.
- Providing $1 million in each of the next two years to the NC Area Health Education Center nursing workforce expansion.
- Giving state-employed nurses, who work primarily in state-run psychiatric facilities, a 3 percent pay increase across the board.
- Allocating $1.3 million to create more health care facility inspections positions to investigate and eliminate the backlog of complaints about acute care and adult care facilities and nursing homes. They also would process expedited licensure applications for residential mental health facilities across the state.
- Giving correctional officers 6.5 percent pay increases. Staffing shortages in the state’s prisons have been cited as an ongoing issue in delivering health care services, mental health and drug treatment and reentry programming for more than 31,000 of the state’s incarcerated population.
When Stein was attorney general, he played a key role in negotiating a multi-state settlement agreement with opioid distributors and manufacturers that brought more than $750 million over an 18-year period to North Carolina to help the state continue to fight and recover from the crisis.
“While North Carolina has made progress at reducing opioid, fentanyl deaths, still too many people are dying,” Stein said.
Now, he’s recommending the creation of a fentanyl law enforcement unit and a prosecutorial team “to investigate and stop the flow of this deadly poison into our communities.”
“Too many North Carolinians have lost a loved one to a drug overdose or a senseless crime, and we honor the victims by tackling this head on,” he said.
Improving access to care
Stein said that to “ensure North Carolinians can access the health care they need,” his proposed spending plan invests more than $770 million in the first year of the biennium and more than $580 million in the second year by leveraging federal funding.
Some of that money will go toward rural health care facilities.
Some will help people with disabilities and traumatic brain injuries who have been advocating for more community-based support for years. Stein proposes spending $35 million by year two of the biennium to support the creation of up to 200 Innovations Waiver slots that go to help people with intellectual and developmental disabilities access community-based services. Another part of that funding will support 75 slots for people to get onto the state’s Traumatic Brain Injury support program.
Stein’s proposal is only the starting point for a budget process that usually takes weeks, and perhaps months, to complete. But it’s not certain how many of his proposals will be adopted by the Republican-led General Assembly, where lawmakers hold the pursestrings for the state. In the coming weeks, the state Senate will release its proposed spending plan, and the state House of Representatives will do the same. Together, they develop one budget for the next two years.
Stein could have more of a say in how that fiscal plan shapes up than his predecessor Democratic Gov. Roy Cooper did during the last two years of his term.
The governor has the power to veto a budget, and the state Senate has enough Republicans to overturn a veto if the objections break down along partisan lines. The state House of Representatives, however,does not have a veto-proof majority this year, leaving more room for negotiations.
Stein’s proposal also calls for:
- Using $14 million to stabilize Federally Qualified Health Centers and Rural Health Clinics by providing reimbursements soon after a claim is initiated, enabling the state to continue implementing a payment structure rolled out in 2023.
- Providing a recurring investment of $100 million to sustain the Healthy Opportunities Program to pay for food, housing, rides to the doctor and other non-medical interventions. It also would expand the program to more counties in western North Carolina.
- Spending $32.7 million in recurring funds for 330 additional school counselors, nurses, social workers and psychologists in schools.
- Providing more than $150 million to support the implementation of prison reentry programs to ensure that adults and young people getting ready to return to their communities after incarceration can access health care services 90 days before release.
- Reserving $208.5 million to help with construction of a new children’s hospital in the Triangle area, and for the construction of three rural care centers that are part of the NC Care Initiative.
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