(The Center Square) – A series of changes in the North Carolina state health plan have wiped out projected budget deficits but staff officials on Monday did not rule out additional premium increases to maintain the plan’s financial stability.
The plan’s costs are still increasing by about 6% a year while revenue from premiums is only going up about 3%, first-term Republican state Treasurer Brad Briner said in a news conference.
“We have made very good progress in digging out of a hole,” Briner said. “But we have more work to do. It’s a basic business problem. If your expenses are going up faster than your revenues, you are going to be in trouble sooner rather than later. We’ve got to get that 6% down to 3%.”
Earlier this year, the board that governs the state health plan approved a new premium scale for employees that is based on income, rather than a flat rate.
That has wiped out a projected $1.3 billion shortfall in the plan, Briner said.
In the Triangle, the state pays twice as much for patient imaging services at some providers than it does at others, Thomas Friedman, executive administrator of the health plan said at Monday’s news conference.
The state is working on developing financial incentives for members of the state health plan to go to less expensive providers, Friedman said.
“It’s going to take time to bear out,” he said of the incentive plan. “We need to start working on it. We’re going to continue to push to find those opportunities to reduce costs in the system and partner and share more of our resources with folks that really want to work with us.”
Some employees criticized the new health insurance rate passed earlier this year that based premiums on income, Briner said.
“You had a situation where everyone was being charged $25 a month relative to the average commercial premium in the state of about $180,” the treasurer said. “There’s been pushback, certainly from people at the higher end of the income distribution. While I understand that, we had a financial hole to solve.”
There will likely be premium changes again in 2026, “but I think they will be a lot smaller in magnitude and scope than they were in the past year,” Friedman said.
The plan is in “significantly better financial footing,” now that it was at the beginning of 2025, he said.
The goal is to keep premiums consistent as a percentage of an employee’s income, Briner said.
“It’s important for people’s budget to know what percentage of their income will go to health care,” the treasurer said. “But it’s equally unrealistic to expect that on a dollar basis, they never go up.”
Although premiums may increase in dollar terms, the goal is to keep them the same as a percentage of the employee’s salary, Briner said.
