NC Healthcare Providers Renew Call for Collaboration on State Health Plan

$1.23 billion cash balance at State Health Plan could preserve care, transform plan

Raleigh, NC – June 7, 2019 – At this week’s meeting of the North Carolina State Health Plan Board of Trustees, staff reported a cash balance of $1.23 billion, with revenues exceeding projections while expenses are falling short of budgeted amounts. The plan, which has embarked on a project to peg health plan rates to Medicare rates, remains fiscally solvent and well-funded going into the next biennium.

On learning of this new unrestricted source of tax dollars, Steve Lawler, president of the North Carolina Healthcare Association issued the following statement:

“The State Health Plan surplus of $1.23 billion tax dollars is a direct result of the work of physicians and hospitals to provide more efficient and effective care and clearly indicates there is time to develop a more thoughtful plan. The Treasurer’s clear pricing project would move access to healthcare and value-based services backward rather than forward. The Treasurer’s approach will slash support to the state’s healthcare safety net and continue a fee-for-service healthcare model that ignores proven proactive methods to provide access to the highest quality services at the lowest cost.”

These proven methods to care, recognized nationally by healthcare leaders, are often categorized under a broad umbrella of Value Based Care. Value Based Care, unlike the clear pricing policy, reduces morbidity and mortality, and lowers healthcare cost for individuals and families. Implementing Value Based Care will support state employees in staying healthy and provide the state with a predictable, sustainable state health plan budget, ensuring wise use of tax dollars and protecting access to care in rural communities.

Mr. Lawler reiterated an invitation to the State Health Plan Board to join healthcare providers in collaborating on a plan to redesign care so that the state employees and retirees, who have spent their careers in service to our State, can proactively manage their own care in the most cost effective and transparent way. If contract rates between providers and insurance companies are a barrier, then NCHA and our members would not object to those rates being disclosed to the Treasurer and his staff.



  • In mid 2018, Treasurer Dale Folwell introduced the “clear pricing project,” a payment plan that utilizes Medicare rates to set prices in a fee-for-service model. After a month of requests, the Treasurer finally met with providers and asked for alternative proposals, but stated clearly that no proposal for Value Based Care would be welcome.
  • In September of 2018, NCHA requested a meeting with Treasurer Folwell to discuss the plan. When NCHA arrived at the meeting with the N.C. Medical Society, the Treasurer asked representatives from the State Employee Association of North Carolina to speak on his behalf. They reiterated that they were unwilling to negotiate and asked NCHA and NCMS to support reference based pricing.
  • NCHA’s request for a true stakeholder meeting, involving provider groups and plan beneficiaries, has never been addressed.
  • In April, the North Carolina House passed House Bill 184 to pause the current path and implement a stakeholder process. The Senate continues to side with the union and not act on the bill.
  • The existence of a $1.23 billion cash reserve indicates that the Treasurer could, in fact, slow down and design a modern plan that will benefit state employees.

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