North Carolina Legislature Cuts LME/MCO Budgets By About 10%; Requires Spending Out Of Reserves

North Carolina’s eight public behavioral health managed care organizations (MCOs) are operating under a cut of about 10% to their state appropriations; the cut totals about $110 million. However, despite the reduction, the MCOs are required to maintain the same level of services. The legislature imposed the cuts in September 2015; the legislators believe the MCOs have sufficient reserves of cash on hand to cover the costs. The legislature cut appropriations to force the MCOs to reduce their reserves. For the 2016-2017 fiscal year, the budget calls for a further reduction of $152 million.

The cuts were imposed . . .