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RALEIGH--Gov. Pat McCrory is calling for a complete reform of the state's Medicaid program, which provides health care coverage to 1.5 million North Carolinians.

In 2012, the General Assembly called for an audit of the program and Thursday we learned the results.

About one in every five North Carolinians with low income is enrolled in the medicaid program.

On Thursday, the state auditor announced there are serious flaws in the program they rely on.

"For the last three fiscal years, the state of North Carolina has exceeded the certified budget in the Medicaid spending area of over $1.4 billion dollars in each year,” said state auditor Beth Wood.

The Medicaid program is administered by the Division of Medical Assistance with in the Department of Health and Human Services.

Beth Wood's audit report reveals:
-no cost accountability
-no monitoring of expenditures
-withholding millions of dollars
-violations of state law

In 2012, the division carried state debt into the next fiscal year by retaining over $131 million dollars worth of federal funds.

Gov. Pat McCrory said North Carolinians should be very concerned that their tax dollars are being wasted

"Every dollar that is mismanaged at the DHHS is one dollar less for things like medical services, education and things like roads and bridge repair,” said Gov. McCrory.

The Department of Health and Human Services hired a new medicaid manager, who plans to make the program more transparent and efficient.

"How do we administer the program better faster and more accurately and how do we create an environment where everybody knows our numbers?" said Medicaid program director Carol Steckel.

DHHS will also be held accountable for timely reports to lawmakers and
McCrory believes cleaning up the inefficiencies will create a better health care system for the state.

Gov. McCrory said lawmakers are still trying to determine how the upcoming changes to the Medicaid program will be reflected in the state's budget.