Medical claims are going to cost the State Health Plan more than anticipated in the next two years, according to plan consultants.
With costs increasing and revenues failing to meet projections, the state health plan’s reserve account will fall below its target in January 2028, consultants told health plan trustees last week.
A looming deficit pushed the State Health Plan trustees to increase beneficiaries’ insurance premiums, out-of-pocket costs, and copays for 2026. The premium increase was the first in years. For the first time, premiums will be pegged to employee salaries.
The health plan is still on firmer financial footing than it has been in the past, state officials told reporters last week. The plan won’t be running a deficit in 2026 or 2027 as was once projected, said Tom Friedman, State Health Plan executive administrator.
But more changes are coming to the insurance plan that covers about 750,000 state employees, teachers, retirees, and dependents.
The health plan trustees are scheduled to vote on benefits changes in March and on premium increases for 2027 in July.
The North Carolina Association of Educators opposed the 2026 premium hikes. Another increase for 2027 would amount to a pay cut for educators, President Tamika Walker Kelly said in a statement.
“Their wages have been stagnant for years—already lagging behind neighboring states and well below the national average,”her statement said. “Now, on top of inflation and a rising cost of living, they’re being asked to shoulder yet another financial burden. Educators do exceptional work in our schools, and they deserve to see the value of that work reflected in both their pay and their benefits.”
After trustees heard a presentation on health plan finances Dec. 5, Friedman said the health plan needs to move more aggressively to lower costs for the plan and for beneficiaries.
“This is a cost problem,” he said. “We have to drive those costs down so we can continue to invest in health.”
Part of attacking that problem will involve creating more financial incentives for beneficiaries to use lower-cost providers, he said.
“There are a lot of areas where there are significant variants in cost that are not driven by quality,” he said. “We have to make it affordable and simple for members to go to lower-cost, high quality providers.”
Using medical imaging — MRIs and other diagnostic scans — as an example, the health plan could save money if more enrollees used free-standing radiology centers rather than getting those scans in hospitals, he said. The plan would have to offer financial incentives to beneficiaries to draw them to the free-standing offices, and would have to negotiate lower costs with the providers in exchange for higher patient volume.
“We don’t need a lot of movement to save tens of millions of dollars in this area,” he said.
That strategy could work in the Triangle, where free-standing medical imaging offices are clustered. But those independent offices aren’t available in and around Mecklenburg County, so health plan administrators will need to use a different strategy there.
Some rural counties have no imaging options nearby. The health plan may need to contract with mobile imaging services to cover rural areas.
The health plan started to build a “preferred provider” network this year, where hundreds of providers have agreed to bundled payments to cover costs of procedures, rather than billing separately for each step in medical treatment. Primary care is the best developed arm of the network, with providers statewide participating, according to a Health Plan map.
An important step in broadening the network will be adding more OB-GYNs and making “better maternity bundles to make it more affordable to have a baby in North Carolina,” Friedman said.
Hence then, the article about nc employees and teachers may see more premium hikes as state health plan costs rise was published today ( ) and is available on NC news line ( Middle East ) The editorial team at PressBee has edited and verified it, and it may have been modified, fully republished, or quoted. You can read and follow the updates of this news or article from its original source.
Read More Details
Finally We wish PressBee provided you with enough information of ( NC employees and teachers may see more premium hikes as state health plan costs rise )
Also on site :