NC State Health Plan premiums frozen for 2024, 6th year with no increase | Eastern North Carolina Now

    Publisher's Note: This post appears here courtesy of the Carolina Journal. The author of this post is Theresa Opeka.

    North Carolinians who are on the State Health Plan (SHP) for their medical insurance will not see an increase in their premiums for the 2024 benefit year. State Treasurer Dale Folwell and the SHP Board of Trustees agreed to the freeze for the sixth year in a row.

    "I'm delighted that we're able to maintain active member premiums, especially family premiums, with no increase for the next benefit year," Folwell said in a press release. "Our members continue to work tirelessly as teachers, state employees, and public servants, and they deserve stability in what they pay for this valuable benefit."

    He said during his monthly "Ask Me Anything" Q&A with reporters there were three reasons why they could keep premiums from going up.

    "No. 1 is great negotiations with our Medicare Advantage product, which has about 145,000 people on it over the age of 65," Folwell stated. "That contract, a five-year contract, is going to save over $1 billion over the five years. The basic plan costs our members nothing and cost the state health plan nothing, so that's No. 1."

    The second reason, he said, is the nearly $800 million of savings, which probably will work toward the billion-dollar number from their renegotiated pharmacy benefit management contract with CVS Caremark.

    Finally, he credits the dedication of the state employees who work in the SHP who "watch the pennies and the paper clips." He said they have partnered with him and State Health Plan directors to save over $100 million over a period of time just in the expenses of administering internally inside the SHP.

    Medicare-eligible members on the Humana Group Medicare Advantage Plans will also see no changes in their premiums. The Medicare Advantage Plans have zero costs to taxpayers and offer spousal coverage to eligible members for only $4, compared to $425 on the Base PPO Plan (70/30).


    Earlier this year, the SHP saved $47 million by enrolling 9,975 additional members into the Humana Medicare Advantage Plans. Currently, 87% of retirees over 65 have taken advantage of the plans.

    Folwell said while there is always room for improvement, they have cut all of the expenses they can inside the SHP.

    "The fact is that as long as the hospital cartel of this state continues to boycott the state health plan and the state employees, by (the hospitals) not coming to the table and accepting 100% profit as a nonprofit entity, the things that we've already done have put us in a position of freezing premiums," he said.

    He said they are not satisfied with just freezing premiums but would like to lower them, pointing out that most entry-level workers with the state have to work one week out of every four to pay the family premium.

    Lowering premiums, Folwell added, would also attract younger, healthier people to the SHP to offset the costs of older plan members.


    "We still have a massive unfunded healthcare liability of nearly $25 billion, No. 1, and No. 2, these are all things that went into the decision-making for the State Health Plan to recommend freezing premiums again," he said. "But before we do any of that, we always make sure we're not changing deductibles, we're not changing copays, and we're making sure that we're building reserves inside the state health plan to the extent possible given these massive pressures that we're seeing in the price of healthcare and prescription drugs."

    Folwell didn't mince words with his disappointment in how Blue Cross Blue Shield North Carolina has been handling the transition in relinquishing its position as the third-party administrator for the SHP to Aetna.

    "After being married to a company for 44 years, and we're going to be married to them for another year and a half, they did not even show up for the State Health Plan board meeting last week," he said. "They're going to continue to be our third-party administrator, and they are going to sue us until they're blue. They want to create as much chaos as they possibly can to make sure that this rollout is not successful."

    Aetna was awarded the Third-Party Administrative (TPA) Services Contract for the SHP in January, beating out BCBSNC and United Healthcare Services, UMR, a health insurance company based in Wisconsin.

    Both companies had their protest appeals of the award rejected later that month by the SHP. UMR notified the SHP in April that it wouldn't pursue an appeal of the denial. BCBSNC, however, sued over the decision in February.

    Folwell said wherever he goes across the state, he is asked why they didn't "divorce" BCBSNC sooner based on the treatment that other medical providers and other types of employers have gotten from the insurer.


    In the meantime, he said Aetna, who attended the SHP meeting last week, is working diligently with hundreds of people dedicated to the SHP account.

    "I'd like to remind everybody on this call that Blue Cross Blue Shield is headquartered in Durham, North Carolina," Folwell said. "None of the three biggest employers in Durham use BCBS, and I think that you'll possibly hear more news going forward about other folks as they look to make sure that they're getting the value that they deserve from their relationship with Blue Cross."