North Carolina Department of Health and Human Services


The North Carolina Department of Health and Human Services is a large state government agency in the U.S. state of North Carolina, analogous to the United States Department of Health and Human Services. The NCDHHS has more than 18,000 employees. The NCDHHS has its origins in the former North Carolina Department of Human Resources. The head of NCDHHS is appointed by the governor of North Carolina, confirmed by the North Carolina Senate, and is a member of the North Carolina Cabinet in the executive branch of the North Carolina government. The NCDHHS was created in 1971.

Divisions and Programmatic Offices

Among its divisions and programmatic offices are:
The following is a list of NCDHHS secretaries:
  • Lenox D. Baker, 1972–73
  • David Flaherty, 1973–76
  • Phillip J. Kirk, Jr., 1976–77
  • Sarah T. Morrow, 1977–85
  • Lucy H. Bode, 1985
  • Phillip J. Kirk, Jr., 1985–87
  • Paul Kayye, 1987
  • David Flaherty, 1987–93
  • Charles Robin Britt, 1993–97
  • H. David Bruton, 1997–2000
  • Carmen Hooker Odom, 2001–07
  • Dempsey Benton, 2007–09
  • Lanier Cansler, 2009–12
  • Albert Delia, 2012–13
  • Aldona Wos, 2013–15
  • Rick Brajer, 2015–16
  • Mandy Cohen, 2017–21
  • Kody H. Kinsley, 2022-2024
  • , 2025-present

    Programs

  • North Carolina LINKS Program

    History

Department of Human Resources (1971-97)

The NCDHHS has its origins in the former North Carolina Department of Human Resources. The DHR was created in 1971 as an umbrella to consolidate what had been more than 300 free-standing state agencies. It was activated as a functional agency on December 10, 1971. The first Secretary of Human Resources, Dr. Lenox Baker, was appointed by Governor Robert W. Scott.
The Division of Public Health, an original part of the department, was taken out of the DHR in 1989. Most of its functions were transferred back to the DHR in 1997, when the agency was renamed the Department of Health and Human Services.

Medicaid system and abuse policy (2004-10)

In April 2004, NCDHHS awarded Affiliated Computer Services a contract to replace the existing Medicaid Management Information System operated by Hewlett Packard Enterprise Services. ACS was to complete the design by the summer of 2006, though the contract was terminated in July 2006 for delays. ACS filed a lawsuit against the state for wrongful work termination, and the civil court case was settled in January 2007, with ACS agreeing to install an additional software suite to help Medicaid generate savings. Two years later NCDHHS again attempted to replace their Medicaid computer system, awarding a $265 million contract to Computer Science Services in January 2009, with an August 2011 deadline for putting the system live.
An incident at NCDHHS psychiatric hospitals in 2009 attracted media attention, when a patient at Cherry Hospital was left in a chair for 24 hours before dying. Lanier Cansler was appointed as Secretary of NCDHHS shortly afterwards. One of his first actions was to create a zero-tolerance policy for patient abuse. A year later, former house co-speaker Richard T. Morgan filed an ethics complaint against Cansler, alleging a conflict of interest when Cansler awarded a no-bid HHS contract to one of his former lobbying clients, Carolinas Center for Medical Excellence. The claim would be dismissed early the next year.
In 2009 and 2010, state regulators found that companies were billing for never performed care in the state Medicaid system, prompting the state General Assembly to change the criteria for patients to be eligible for Medicaid's personal care services. On September 8, 2010, Disability Rights North Carolina wrote an open letter to the Department of Justice and Centers for Medicare & Medicaid Services, stating that despite thousands of individuals being referred to in-home PCS since April 1, "relatively few" individuals had received care since, despite NCDHHS' code dictating that "assessments and patient notification should occur within 14 days." On November 4, 2010, WRAL published a report that delays in the NCDHHS Medicaid program had "people waiting weeks or months for care," with one elderly double-amputee still waiting to receive state-funded in-home care after five months. Disability Rights North Carolina further reported that people were dying as they waited to be assessed for services. Explained WRAL, "the state tried to rid the system of fraud and abuse, but the result has been that those who aren't trying to take advantage of the system are unintentionally penalized."

Vetoes and budget cuts (2011)

The state budget for the division overseeing Medicaid was around $3 billion by 2011. In July 2011, Republican lawmakers in North Carolina overrode three of Governor Bev Perdue's vetoes, including her veto of the budget bill for the state, making the S781 measure into law. Medical Malpractice Reform S33 and Medicaid/Health Choice Provider Requirement S496 were also both passed into law. The vetoes met with a fair degree of controversy both politically and in the press. About one of the passed laws, WRAL wrote "federal rules require Medicaid to be managed by a single state agency. S496 would give the final say in Medicaid appeals to an administrative law judge, not to NCDHHS, the agency administering the grant. Democratic critics of the bill said the change could provoke federal officials to withhold some or all of the state's Medicaid money, but Republicans countered that if it did, NCDHHS could suspend that part of the statute while seeking a waiver from the feds."
As a result of the vetoes, Republican lawmakers passed a $19.7 billion state budget that dictated cutting $356 million in state Medicaid funding by April 2012, with a provision requiring NCDHHS to make their own budget changes to achieve the cut. In August 2011, Cansler announced that NCDHHS would find it "next to impossible to achieve this budget," noting that the relatively long federal approval process for budget cuts might make the April 2012 deadline untenable. Cansler explained that without legislative approval of cuts granted in a timely manner, to meet the deadline NCDHHS would "have to make additional reductions," including potentially cutting services defined as "optional" such as podiatry, dental care, organ transplants and hearing aids. To allow input on what to cut, Cansler made North Carolina Medical Care Advisory Committee meetings public.

Budget shortfall and cuts (2011)

By October 2011, NCDHHS was facing a projected $139 million budget shortfall for Medicaid, partly because of "other agency liabilities that weren't paid for in the spending plan." NCDHHS argued that the legislature's dictated budget cuts hadn't taken into account a $300 million accounting error from 2008, and also hadn't noted that "the state also must repay $42 million after a federal audit found personal care services were either billed improperly or had inadequate documentation from providers." Among other problems, NCDHHS also stated that some of the requested cuts were illegal according to Medicaid's federal rules, and could endanger millions in federal revenue. Also, a slow approval process for changes from the Centers for Medicare and Medicaid Services was projected to interfere in actually implementing the cuts before the state's deadline.
After creating a list of potential NCDHHS budget cuts for the General Assembly, on October 27, 2011, Cansler wrote a letter to Governor Perdue, arguing that forced NCDHHS cuts to meet the shortfall would be "devastating" to patients and health care providers in North Carolina. In response, House Speaker Thom Tillis argued the shortfall was the fault of NCDHHS for not communicating, stating "a lot of those cuts were made in consultation with the secretary and the Department of Health and Human Services. Obviously, if we'd been consulted by them and they said they weren't possible to begin with, wouldn't have been in there." Cansler, however, argued the nature of the cuts had been explained in two letters from the governor to the committee, dated in May and June. According to NCDHHS, in October, several lawmakers "publicly pledged to help fill the shortfall," eyeing the state's at the time $150 surplus to help. Stated representative Nelson Dollar at the time, "we are not going to cut services, and we are not going to cut rates to make up for one-time liabilities."

Medicaid IT delays, shortfall patch (2011-12)

In late 2011, NCDHHS revealed ongoing problems with the state's contract to refurbish the Medicaid billing system. In particular, the state's 2008 contract with Affiliated Computer Services had faced two year delays, with the budget running from $287 million to $495 million. All but about 10% of the contract was paid with federal, not state, dollars. Cansler stated the delays were due to constantly changing federal guidelines, requiring constant system redesign. A performance audit of NCDHHS released on January 10, 2012, found problems with oversight of the Medicaid system's development. Among other budgetary missteps, the audit claimed that the computer system had been altered after final approval, leading to unexpected changes in the software.
Despite the General Assembly's response to the Medicaid budget shortfall in October 2011, over the following months money was not indicated by lawmakers as available except through the governor's office, leaving NCDHHS the choice of either "large-scale rate cuts or the elimination of some optional services". NCDHHS announced in December 2011 that it might cut adult services like hospice care and mental health care. As a result, the press reported that disabled but mentally sound North Carolinians could be institutionalized or made homeless. Reimbursements for physicians were also put on the cutting block, though as of January 2012, the federal government had approved less than half of the 54 rate cuts proposed by NCDHHS. At the time the press described a growing "political fight" on how to fill the budget hole, with "no signs of a solution". Officials estimated the Medicaid shortfall could grow to US$243 million by the end of the year.
On January 13, 2012, Cansler resigned from his role as secretary of NCDHHS, giving a two-week warning. Governor Perdue named Al Delia, her senior policy advisor, as acting secretary of the department in early February. At the time, Cansler stated in interviews that he had grown frustrated with the "political contest" over funding in the state legislature. Early in 2012, legislators passed a patch for the Medicaid shortfall. That year, the Medicaid program was estimated to have a $13 billion budget in state and federal funds.