RALEIGH -- The head of the state Medicaid program is out of a job.

Health and Human Services Secretary Al Delia fired Dr. Craigan Gray, who served as Medicaid director since April 2009. Gray earned a salary of $270,000.

Chief Deputy Secretary Michael Watson will replace Gray and the position of director of medical assistance will be elevated to report directly to the secretary.

Watson's salary will remain at $160,000.

The move was part of a restructuring of the department, according to a press release.

“After nearly six months in this role, my first priority for strengthening our management team is to elevate the state Medicaid office to play a more prominent role in the Department’s decision-making process,” said Delia, in the statement.

“Medicaid is not a stand-alone division. It touches not only multiple DHHS divisions but also plays a huge part in shaping the state budget. We need better communications and stronger oversight of this $12 billion program. I believe these changes will accomplish that.”

Medicaid is a budget albatross for legislators, as they are trying to fill a $200 million hole. The program has had budget overruns amid economic woes in the state.