Understanding the October 2025 NC Medicaid Changes and What They Mean for Your Family

News of changes to North Carolina's Medicaid program can create significant uncertainty for families. When you rely on these services to support your adult child with an intellectual or developmental disability (IDD), any potential disruption feels personal. The stability and progress you have worked so hard to build can feel at risk.

We have written this article to offer you a clear breakdown of the recent changes to Medicaid reimbursement rates. It explains what these changes mean in practical terms and outlines the steps you can take to effectively navigate this new landscape, empowering you to advocate for your adult child’s well-being and independence.

What is Happening with NC Medicaid?

Effective October 1, 2025, North Carolina's Department of Health and Human Services (NC DHHS) implemented reductions to the reimbursement rates it pays to providers for many Medicaid services. This decision was made to keep the Medicaid program within the budget allocated by the North Carolina General Assembly.

These are not recommendations; they are mandated changes that affect all providers who accept Medicaid. While some changes took effect on October 1, you may see the impact at different times depending on the specific services your adult child receives and the managed care organization (LME/MCO) that oversees them.

This means that the organizations providing essential services, from in-home support to therapies and day programs, will receive less funding from the state for the care they deliver. This inevitably has a downstream effect on service availability, staffing, and overall support structures.

How Could These Changes Affect Your Adult Child's Services?

The rate reductions vary across different types of services. While the percentages may seem small, their impact can be significant. Understanding which services are affected can help you anticipate potential challenges and prepare accordingly.

Services for Independent Living and Community Support

Key programs that foster independence are directly impacted. Funding for services under the Innovations Waiver, the 1915(i) Waiver, and the Traumatic Brain Injury (TBI) Waiver will be reduced by 3%. These waivers are critical for providing alternatives to institutional care and helping individuals with IDD live and thrive in their communities. 

Similarly, the Community Alternatives Program (CAP), which provides vital in-home support, will see a reduction of 8% for personal care-like services and 3% for other services. These supports are often what make it possible for an adult child to remain at home with their family. 

Therapy and Specialized Care

Many families rely on consistent therapeutic support to help their adult child build skills and maintain their health. The announced changes include a 10% rate reduction for Ambulatory Surgical Centers and a 10% reduction for services from a Psychiatric Residential Treatment Facility (PRTF). Other behavioral and mental health services will see rate reductions between 3% and 10%. 

These adjustments can make it more difficult for specialized clinics and therapy providers to operate, potentially limiting access to the consistent, high-quality care your family depends on.

The Real-World Impact on Families and Support Professionals

These financial adjustments are not just numbers on a spreadsheet; they have profound, real-world consequences for families, caregivers, and the professionals who provide support.

Challenges for Direct Support Professionals (DSPs)

DSPs are the backbone of the support system for many individuals with IDD. Provider agencies, facing reduced funding, may be forced to cut wages or halt wage increases for their staff. This makes it incredibly difficult to recruit and retain qualified, dedicated DSPs, who are already in short supply. High turnover rates can disrupt the trusting relationships and consistent routines that are essential for your adult child’s progress and stability.

Financial and Emotional Strain on Families

When formal support systems are strained, the responsibility often falls back onto the family. You may face greater difficulty finding reliable respite care or community-based support. Many families report that the uncertainty alone is exhausting, as they are left wondering if the services their adult child relies on today will still be available tomorrow.

Disruption to Daily Routines and Progress

Community and day programs, which provide structure, social connection, and vocational training, are also affected by these funding changes. Reductions in their budgets can lead to scaled-back hours, fewer activities, or even program closures. This loss of routine and community connection can undermine the hard-won progress your adult child has made toward independence and a purpose-filled life.

What Steps Can You Take Now?

In the face of these changes, it is essential to be proactive. Your voice and your actions are powerful tools for ensuring your adult child continues to receive the care they need.

1. Stay Informed from Official Sources

Information can change quickly. It is best to monitor the official channels for the most accurate updates. NC DHHS posts all bulletins on its website, and updated fee schedules, which detail the new payment rates, are also available online.

• NC DHHS Website 
• NC Medicaid Provider Bulletins 
• Updated Fee Schedules 

2. Review Your Adult Child’s Plan of Care

This is a critical time to review your adult child’s Person-Centered Plan (PCP) or Individualized Service Plan (ISP). Understand exactly which services are authorized and how they might be affected. Schedule a meeting with your case manager to discuss any concerns you have. A dedicated case manager can help you understand the changes, explore all available options, and advocate on your behalf with the LME/MCO.

3. Advocate for Your Family by Sharing Your Story

State legislators and policymakers need to understand the human impact of their budget decisions. Sharing your personal story is one of the most effective ways to advocate. Explain what Medicaid services your adult child receives and how they contribute to their quality of life and independence.

When you contact your State Representative or State Senator, focus on being respectful and clear. Describe how these reductions will personally affect your family. Whether you send an email, request a virtual meeting, or attend a legislative hearing, your perspective is invaluable.

Navigating these systemic changes can feel overwhelming, but you are not alone. By staying informed, working closely with your support team, and using your voice, you can continue to champion a future where your adult child has every opportunity to break through limitations and thrive.

Your Covenant Partnership in Navigating These Changes

After reading about these significant, state-wide challenges, it is natural to feel concerned. We want to be very clear about what this means for you as a member of the Covenant family: Your services are secure.

While other providers may be forced to reduce services or navigate difficult cuts, Covenant has made the decision to absorb the full financial impact of these Medicaid rate reductions. This is not a problem you will have to navigate or a disruption you need to plan for. It is a challenge we are handling internally so that the support you rely on remains stable and consistent.

Your adult child’s plan of care, their trusted support team, and the daily routines that foster their independence will not be affected by these state-level changes. Our commitment is to provide unwavering partnership and true peace of mind, regardless of the financial pressures on the industry. This stability is what it means to be part of the Covenant community.

We believe it's important for you to be informed about these issues, but it is more important for you to know that you are protected.

If you have any questions or would simply like personal reassurance, please do not hesitate to reach out to your case manager or support coordinator. They are available to confirm this for you and discuss the continued, stable support your family can always expect from us.