(The Center Square) – The board that governs the health insurance plan for about 775,000 North Carolina state employee and retirees on Tuesday approved higher deductibles and copays as a way to reduce its $507 million deficit and lower projected premium increases.
“Benefit changes or more substantial premium increases – those are fundamentally the two options right now,” Tom Friedman, executive administrator of the health insurance plan, told board members. “But we have to do something different here to be successful.”
Brad Briner, state treasurer of North Carolina
For example, on the state’s “Standard” plan, formerly called the 70-30 plan, the annual deductible will double from $1,500 to $3,000.
“I know the changes to benefits the board made today are hard, but I’m confident that these changes, coupled with new provider opportunities we’re working on, will place the Plan on a stronger financial path moving forward,” said Brad Briner, state treasurer and board chairman of the board. “We’re evolving from what we’ve learned and focusing on what works: trusted provider relationships, financial predictability and meaningful support for our members’ health.”
The board Tuesday approved a Preferred Provider Plan. Employees who choose to use those providers for in-patient hospital care and outpatient surgery, could do so at far lower costs, Friedman said.
“We are trying to create a path for free or much cheaper for you,” Friedman said.
Copays will also be across the board for prescription drugs. However, many pharmaceutical companies have assistance programs that provide coupons to cover most of the copay costs, Friedman said.
He said if the drug companies “are willing to pay the copay, we can make them pay a larger copay of behalf of the member, and the plan will then wind up paying less for the medication. It’s an intentional strategic decision to increase that copay to extra greater value out of the coupon and pharmacy rebate programs.”
The board meets again in August to consider increasing premiums for the health care plan.
“Because of the steps taken by the board today, it is expected premium increases will be less than previously anticipated,” Briner’s office said in a news release.
