North Carolina Reverses Its 3% NEMT Rate Cut and Corrects Trips From the Cut Period

North Carolina Medicaid cut NEMT pay to 97% of September 30, 2025 rates on October 1, 2025. On December 10, 2025, the state said court rulings required it to reverse the cut. From December 17, 2025, new county authorizations and NCTracks claims pay full rates, and claims from the cut period are corrected. A law signed April 30, 2026 then covered the $319 million shortfall the state had cited.

What changed

Item	Detail
The cut	From October 1, 2025, NEMT paid 97% of the rate in effect on September 30, 2025, for trips completed on or after October 1 and submitted through NCTracks
Why	NC Medicaid cited a funding shortfall from the General Assembly in House Bill 125
Trips covered	NC Medicaid Direct trips arranged by county Department of Social Services (DSS) offices. The state also planned to require health plans to pay NEMT at 97%
Not covered	Mileage reimbursement, gas vouchers, and meals and lodging that counties pay directly
Reversal	Announced December 10, 2025, after court rulings
Full rates again	New prior authorizations from December 17, 2025, and NCTracks stopped taking 3% off NEMT claims that day
Funding	Session Law 2026-1 (House Bill 696), signed April 30, 2026, appropriated $319 million from the Medicaid Contingency Reserve to NC Medicaid for the 2025-2026 fiscal year, retroactive to July 1, 2025

County NEMT trips are not on a state fee schedule. Each county DSS negotiates your rate in its contract, enters a prior authorization for each trip in NCTracks, and your claim pays the authorized amount. The cut applied to that amount. Our North Carolina state guide explains how county and broker trips work.

How the cut worked on county trips

The state gave each county two choices. It could amend its contracts with NEMT companies to pay 97%, or keep the contracted rate and pay the 3% difference from county money. On November 21, 2025, NC Medicaid told counties not to raise vendor rates to make up the difference.

The cut was applied in two ways. At first, counties took 3% off each authorization by hand before sending it to NCTracks. From November 23, 2025, counties entered 100% of the rate and NCTracks took off the 3% itself, for authorizations with dates of service from October 1, 2025 that were submitted on or after November 23.

How the corrections work

The fix depends on when the authorization or claim went into NCTracks.

Submitted	How the 3% was taken	How it is corrected
October 1 to December 15 or 16, 2025, cut by the county	The county entered an authorization 3% lower	The county sends an updated authorization record with Action Code 1 and the full amount. Claims already filed on it reprocess automatically once it is updated
November 23 to December 16, 2025	NCTracks took 3% off automatically	NCTracks system updates, effective December 17, 2025, pay the 3% back to NEMT companies
December 17, 2025 or later	No cut	Paid at the September 30, 2025 rate. Your claim amount must match the authorization

The January 27, 2026 county letter dates the hand-cut window as claims submitted October 1 through December 15, 2025. The December 19, 2025 bulletin lists authorizations submitted October 1 through December 16.

Counties that paid the 3% out of their own funds have a cleanup step. Under NC Medicaid’s March 3, 2026 letter, a county can claim that money back from the state for claims submitted October 1 through November 22, 2025. For claims submitted November 23 through December 16, 2025, NCTracks has already paid NEMT companies the 3%. The county must then work with its NEMT company to get its own 3% back.

Health plan trips

As of September 2026, the health plans arrange rides through two brokers, Modivcare and MTM Health. NC Medicaid’s October 30, 2025 bulletin said it would amend plan contracts to require NEMT payments at 97% of the September 30, 2025 rates. Its December 19, 2025 reversal bulletin set the managed care timeline for restored fee schedules, targeted for posting January 5, 2026. Plans had 45 days to load them and 30 more days to reprocess cut claims with dates of service from October 1, 2025. That bulletin does not mention NEMT by name.

If a broker paid you less for plan trips during the cut, ask it in writing whether and when it is paying the difference. See our Modivcare and MTM Health provider guides for their provider lines.

What county NEMT vendors should check now

1. Pull every NCTracks remittance for dates of service October 1 to December 16, 2025. Compare each paid amount with your September 30, 2025 contract rate. Our guide to reading a remittance advice shows where the paid amount sits.
2. Chase hand-cut authorizations. For trips the county cut by hand, confirm it sent an updated authorization and that your claim reprocessed. If not, ask the county’s transportation coordinator.
3. Expect a repayment request if your county covered the 3%. If the county paid you the difference during the cut, the March 3, 2026 letter tells it to work with you to get that money back for claims NCTracks has corrected.
4. Match every claim to its authorization. NC Medicaid’s December 22, 2025 letter says that if the company or the county enters a lower amount, NCTracks pays the lower amount.
5. Confirm your rate going forward. The state restored reimbursement based on agreements in place on September 30, 2025. If your county amended your contract to 97%, get your current rate in writing.
6. Plan for the next budget fight. The $319 million in Session Law 2026-1 is nonrecurring money, and Governor Stein urged lawmakers to use recurring funding for Medicaid. Keep a cash cushion. See NEMT cash flow and how NEMT rate increases happen.

For rates in other states, see NEMT reimbursement rates by state.

Key dates

Date	What happened
September 29, 2025	NC Medicaid tells county DSS directors about the 3% NEMT cut
October 1, 2025	The cut takes effect
November 23, 2025	NCTracks starts taking the 3% off automatically
December 10, 2025	The state announces the reversal after court rulings
December 17, 2025	Full rates return for new authorizations and claims. NCTracks updates take effect to repay the 3% on claims submitted November 23 to December 16
January 27, 2026	Counties get steps to update hand-cut authorizations
March 3, 2026	Counties get steps to recover the 3% they paid from their own funds
April 30, 2026	Governor signs Session Law 2026-1, with $319 million for Medicaid

Who to contact

• Your county DSS transportation coordinator: for authorizations, rates, and repayment questions on county trips
• NCTracks Call Center: 800-688-6696
• NC Medicaid Contact Center: 888-245-0179, Monday to Friday, 8 a.m. to 5 p.m.
• Health plan trips: your broker’s provider services line