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ASNC Policy Update 

March 2024 Medicaid Rate Increases and Direct Support Professional Wages 

In the state budget passed in late September, the North Carolina General Assembly appropriated funding to increase the rates paid for certain types of services under North Carolina’s Medicaid programs to increase the pay of individuals providing the critical supports and services to individuals with autism. This is a positive step forward in valuing the work of Direct Support Professionals (DSPs) sometimes also called Direct Support Workers (DSWs) or Direct Care Workers (DCWs) and increasing access to I/DD services. The Autism Society of North Carolina (ASNC) encourages you to thank members of the North Carolina General Assembly, especially House Committee members and Senate Committee members for their commitment to ensuring I/DD services are staffed.  

Not every Medicaid service got a rate increase. The NC General Assembly appropriated $176 million in state and federal recurring funding in the Current Operations Appropriations Act of 2023 (SL 2023-134, Section 9E.15) to raise NC Medicaid Innovations waiver services rates so that Innovations services providers can in turn raise the hourly wages of direct support professionals they employ. In addition, the NCGA appropriated $220 million in recurring funds in the budget to increase Medicaid reimbursement rates for providers of mental health, substance use disorder (SUD) and intellectual/developmental disability (I/DD)-related services.   

Rate increases for Innovations Waiver Services 

A substantial Innovations rate increase will​ help hire and retain more DSPs, so for those with an Innovations waiver slot, but no staff, an increased rate that will increase a DSP’s wages, can help with their ability to find and keep a supports worker.  

Only some services within the Innovations waiver program that use DSPs will see an Innovations rate increase. This includes Community Networking, Residential Supports, Supported Employment, Respite Care, Community Living and Supports, Day Supports, and Supported Living. This rate increase will be retroactive to July 1, 2023.  

In North Carolina, the Division of Health Benefits (Medicaid) sets the base rate paid for Medicaid services, sometimes referred to a “setting the floor” for a rate. Local Management Entities (LME MCOs), which are the regional government authorities for MH/DD/SUD services, then set the final rates paid for most Medicaid MH/SUD and I/DD services to providers. Those rates are either at the minimum base rate or an enhanced rate based on LME MCO funding and any other regional factors. This means that if an LME MCO is already paying a higher rate due to things like maintaining pandemic era rate increases, or increased rates due to Electronic Visit Verification, or other rate change issues prior to July 1, 2023, the LME can take those existing higher rates into account when setting a new rate for Innovations Services. The end result may be that some LME MCOS will continue the current enhanced rates and providers, and their DSP employees may not see an increased rate for specific services.    

Some Innovations services will get an increase in some parts of the state while other Innovation rates may remain close to the existing rate enhancements. This DHHS memo outlines guidance around supplanting dollars for existing rate increases: NC Medicaid Innovations Waiver Provider Rate Increase | NC Medicaid (ncdhhs.gov).

Given this, and that the memo clearly states that there were not enough funds appropriated by the North Carolina General Assembly in this budget year to achieve the $18 per hour for DSPs goal, ASNC will continue to advocate for wages that reflect both the value that DSPs have to people with I/DD and the current economic market. Advocacy around DSP wages remains a critical part of access to services and supports for people with I/DD. This rate increase won’t get wages to where they need to be, and DSPs should not have to wait another decade for a rate increase when many entry level service jobs already pay $20+ dollars per hour. ASNC encourages you to reach out to members of the NCGA and advocate for a rate increase that will pay a competitive wage for DSPs. 

Rate and wage increases aren’t the only things needed to improve access to quality services and supports. We look forward to improvements in the education and training of DSPs through our community college system, and eventual career ladders for DSPs who continue their careers working with people with I/DD. 

Rate increases for “Behavioral Health” (also include increases to some I/DD services) 

North Carolina’s Division of Health Benefits (DHB) is also increasing rates for other mental health and intellectual and developmental disabilities services in its state plan services: NC Medicaid Behavioral Health Services Rate Increases | NC Medicaid (ncdhhs.gov)

 Sometimes these services get referred to as “behavioral health” but they also include services used by people on the spectrum and others with I/DD like research based behavioral health treatment for autism (RBBHT), developmental/psychological testing done by psychiatrists and psych nurse practitioners, diagnostic assessments, 1915i services, TBI services and in lieu of services (ILOS).   

These rate increases are based on other factors outlined in the DHB memo, including increasing rates on par with Medicare, health care inflation, improving access, maintaining rate parity with other similar services within Medicaid (like Innovations). Rates will also be increased in services that support individuals in group homes to offset the end of the group home stabilization and transition funds.  

Accountability for Rate Increases Dedicated to DSP/DCW Wage Increases 

NC DHHS, DHB and the LME MCOs, as with all rate increases and all provision of services under Medicaid, are responsible for working with providers to assure accountability of how funds are used. Guidance has been issued from DHB and the LMEs about the use of funds from rate increases and what accountability measures will be put in place including the requirement that providers attest to the use of funding for DSP wages. Note that LME MCOs already regularly monitor, review and audit providers for quality assurance purposes. 


Direct Care Worker (DCW) Page on DHHS’s website with information on this and other DCW initiatives https://medicaid.ncdhhs.gov/DCW-Initiative 

Thanking Members of the NCGA/Advocating for rates and wages 

Senate and House Appropriations Committees on Health and Human Services  

Senate Committee: https://www.ncleg.gov/Committees/CommitteeInfo/SenateStanding/143  

House Committee – https://www.ncleg.gov/Committees/CommitteeInfo/HouseStanding/10  

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