Dispute over Medicaid services for autistic children returns to court
A Wake County judge will decide whether to issue an injunction blocking cuts to state Medicaid funding for services provided to children with autism.
Judge George Collins issued an order last week temporarily blocking a reimbursement rate cut. An injunction hearing was scheduled Monday morning.
Families of 21 children who use the services sued the North Carolina Department of Health and Human Services and Secretary Devdutta Sangvai over the rate cut last month.
DHHS reduced provider reimbursement rates after the state House and Senate reached no deal to resolve a Medicaid budget shortfall.
“Plaintiffs in this avoidable and regrettable suit are North Carolinian children with autism spectrum disorder (ASD) who have been unfairly placed in the middle of a political impasse over the State’s biennial budget,” the families’ lawyers wrote on Oct. 31. “After the General Assembly did not enact a full budget by the beginning of the 2025-26 state fiscal year, Defendants imposed rate cuts for N.C. Medicaid. But these cuts did not affect all N.C. Medicaid recipients equally.”
“While most services received at least a 3% cut, some were singled out for different treatment,” the plaintiffs’ court filing continued. “Among those targeted for an ‘enhanced’ rate reduction were certain disabled North Carolinians those with ASD for the highest level of cuts. Defendants cut rates by 10% for Research-Based Behavioral Health Treatments (RB-BHT), including applied behavioral analysis (ABA) therapies, which children with ASD sorely need and rely on to improve their social, communication, and other life skills and dramatically improve their long-term outcomes.”
“By contrast, Defendants cut rates for other services by as little as 3% and did not cut some services, like pharmacy benefits, at all,” the plaintiffs’ lawyers argued.
“Singling out treatment needed by North Carolinians with ASD for harsher cuts than those imposed on other Medicaid recipients is unlawful,” the brief continued. “Even if Defendants were not acting with any animus toward individuals with ASD, by singling out individuals with ASD for a higher rate cut, Defendants have deprioritized the well-being of individuals with ASD. Such discrimination against these children because of their disability violates the North Carolina Persons With Disabilities Protection Act (NCPDPA) and denies them the due process and equal protection rights guaranteed by the North Carolina Constitution.”
“Absent speedy and decisive intervention from this Court, Plaintiffs face a substantial risk — indeed, for some, a near certainty — of significant, irreparable harm,” the plaintiffs’ lawyers argued. “Plaintiffs can access these treatments only if they are funded by N.C. Medicaid. Because of Defendants’ discriminatory rate cuts, Plaintiffs now may be unable to access necessary medical services and thus will suffer the irreparable consequences of such denial or delay — including significant harm to their ability to live normal, fulfilling lives.”
The department responded Monday morning.
“The North Carolina Department of Health and Human Services is charged with administering the NC Medicaid Program as dictated in the General Statues and within the confines of the funds appropriated to the program by the General Assembly,” DHHS lawyers wrote. “For Fiscal Year 2025-26, the funds allocated by the General Assembly to NC Medicaid resulted in a $319 million shortfall of the amount needed to maintain the current services and provider payments.”
“As a result of the budget shortfall and the controlling authority for operation of the NC Medicaid program, the Department made reimbursement rate cuts across its array of covered services with the goal of ensuring that all Medicaid beneficiaries continue to have access to covered services,” the state’s court filing continued. “As part of these carefully considered provider reimbursement rate cuts, DHHS partially reversed a 2024 rate increase for Research-Based Behavioral Health Treatments (RB-BHT).”
“Even after DHHS’s decision, the reimbursement rate for RB-BHT services is still higher than it was just two years ago,” DHHS explained. “Indeed, if the rate cut remains in place, NC Medicaid will still spend $400 million more for RB-BHT services in Fiscal Year 2025-26 than it did in Fiscal Year 2022-23.”
“One consideration for the determination was that on January 1, 2024, RB-BHT received a reimbursement rate increase of 15%,” the court filing continued. “In 2022-23 Fiscal Year, prior to the rate increase, NC Medicaid reimbursed $199 million dollars for the RB-BHT services. After the 15% rate reimbursement increase there was a surge in the number of claims per beneficiary. Spending on RB-BHT service is projected to increase 425% by 2026.”
“The current estimate for reimbursement of RB-BHT in 2025-26 Fiscal Year with the 10% rate reduction is $639 million,” DHHS lawyers wrote. “NC Medicaid estimates to reimburse $440 million more dollars for RB-BHT services than it reimbursed just two years ago even with implementing a 10% cut. These and other factors were taken into consideration when determining rate cut percentages.”
“DHHS performed well-reasoned, mathematical financial assessments for all NC Medicaid services to determine rate reimbursement reductions to fit the certified budget,” the department explained. “DHHS made very difficult decision to ensure that necessary healthcare services continue to be available for North Carolinians throughout the entire fiscal year and did so as required by statute. There is no evidence that the provider reimbursement rate cut to the RB-BHT service was discriminatory.”
“Dispute over Medicaid services for autistic children returns to court” was originally published on www.carolinajournal.com.
