RALEIGH — North Carolina State Treasurer Dale Folwell is seeking more than $2 million in legal fees from Blue Cross Blue Shield of North Carolina following the conclusion of a legal dispute over the State Health Plan’s third-party administrator contract being awarded to Aetna.
“Number one, you don’t get what you don’t ask for,” Folwell said during his monthly call with reporters about why he was pursuing the legal fees from Blue Cross Blue Shield of North Carolina (BCBSNC).
“I think when you’re the keeper of the public person, you’re watching the pennies and the paper clips, you have responsibility to collect any money that you think is owed to you,” added Folwell.
BCBSNC sued after the North Carolina State Health Plan decided in December 2022 to replace BCBSNC with Aetna as the plan’s third-party administrator. An estimated $140 million in savings and greater transparency were part of the decision to make the change.
Folwell sent a letter on Oct. 30 to BCBCNC President Dr. Tunde Sotunde demanding repayment of legal fees spent on the case by the N.C. State Health Plan. The letter gave Sotunde 30 days to respond.
“You owe the people of North Carolina $2,047,114.35 for your failed ‘sue till you’re blue’ lawsuit,” Folwell’s letter states.
The letter to Sotunde goes on to outline key points in the case, including BCBSNC’s failure to prove the bid process faulty, characterizing BCBSNC’s suing as a “legal tantrum” that used “legal gymnastics” to “impugn the integrity and intelligence” of Folwell’s staff and the State Health Plan’s board.
“Our defense of your failed lawsuit cost the Plan $2,047,114.35,” Folwell wrote. “While $2.05 million may be inconsequential for a company that paid its CEO over $4 million in 2021, $2.05 million is a substantial amount for our members and the Plan, especially as we fight looming insolvency caused by sky rocketing healthcare costs.”
Folwell also said his agency wished BCBSNC had shown “as much fight into serving us over the years, and put as much fight into possibly their application, as they had this court battle.”
The outgoing treasurer said he had no idea how BCBSBC would respond.
“They have been unpredictable since losing this contract in terms of their response,” he said.
Folwell said his legal team was advising him on next steps should BCBSNC did not respond by the Nov. 30 deadline in his letter to BCBCNC’s president.
“Our focus is providing the highest level of service to state employees throughout our current agreement with the State Health Plan and ensuring a smooth transition for the Plan’s members,” a BCBSNC spokesperson said in response to an inquiry by North State Journal.
In addition to next steps on the more than $2 million Folwell is seeking from BCBSNC, he also told reporters his office will be doing a closeout audit.
“We do this with every major vendor so that we have a closeout to make sure that there’s not recapture or other monies that may be owed to the State Health Plan,” said Folwell.
Incoming Treasurer-elect Brad Briner, a Republican like Folwell, will be participating in transition meetings at Folwell’s office. Folwell said Frank Lester, the deputy treasurer, has been leading up transition efforts, and Folwell has a “big stack” of items to review with Briner.
As for Folwell’s next steps, he said, “My future plans right now are to remain centered on fixing things and saving money. And I want God and my family and friends and my motorcycles to all be happy with me — in that order.”
Folwell has spent upward of 30 years in public service roles and elected positions spanning both local and state government in North Carolina, as chronicled in North State Journal’s five-part series on the treasurer, “Portrait of a politician: The life and careers of Dale Folwell.”
