Hybrid deal brings State Health Plan fight to an end

NSJ Staff—
State Treasurer Dale Folwell. Feb. 1

RALEIGH — Last week, State Treasurer Dale Folwell and Blue Cross Blue Shield of North Carolina (Blue Cross NC) signaled an end to the fight over the changes to the State Health Plan by announcing a hybrid plan letting major hospitals and care systems operate as in-network facilities.

The State Health Plan’s network for 2020 will consist of Blue Options Network and the new North Carolina State Health Plan Network.


Under the hybrid plan, health care providers that failed to sign up by the Aug. 5 deadline to Folwell’s Clear Pricing Plan will be allowed to keep their existing agreements with Blue Cross Blue Shield of North Carolina.

According to a press release, the two network options combined will consist of more than 68,000 providers. Members of the State Health Plan can still use their provider network and will have access to new providers that were not previously part of the Blue Options Network.

“We look forward to working with Treasurer Folwell and the State Health Plan to implement these changes and ensuring that teachers and state employees have uninterrupted access to quality care,” said Patrick Conway, MD, Blue Cross NC President and CEO.

“The Clear Pricing Project is just the beginning. I appreciate that 28,000 providers — independent primary care providers, behavioral health providers, independent provider networks and the 5 courageous hospitals — have chosen to provide care to those who serve in state government,” said Treasurer Folwell. “These medical providers should be applauded.”

Blue Cross Blue Shield will continue to administer the state insurance plan, which covers over 720,000 state employees.

The treasurer’s office has said Clear Pricing will provide savings to taxpayers who already fund the State Health Plan to the tune of $166 million a year. The full costs of the plan are roughly $3.4 billion annually. Members of the plan would save another $34 million, according to the treasurer’s office.

The hybrid plan announcement comes after Folwell altered his original offer and re-opened enrollment last month. Folwell said last month that the proposal in July was a “final offer” and would give hospitals $116 million more than previously offered.

The July revised plan increased payouts to medical providers from 182 to 196 percent of Medicare, and combined inpatient/outpatient ratios for urban hospitals were increased from 178 to 200 percent of Medicare.

Despite the increased rate, Folwell said that 600-700 providers came on board but only one hospital signed up by the Aug. 5 deadline. Folwell says the nearly 28,000 who have joined the plan is “a start” and that he thinks momentum from people upset with excessive drug and medical costs will propel future change.

In the statement announcing the final hybrid plan, Folwell slammed hospitals for “cartel-like tactics” by spending millions to oppose lowered costs and more transparent pricing.

“If big hospitals could do this to their largest customer, just think what they can do to the individual average citizen or business,” said Folwell.

Folwell continued, saying, “We’re in a medical arms race in North Carolina. Every dollar unnecessarily or inefficiently spent on health care is a dollar that can never be spent on education and other core functions of government.”

About A.P. Dillon 1343 Articles
A.P. Dillon is a North State Journal reporter located near Raleigh, North Carolina. Find her on Twitter: @APDillon_