RALEIGH — The North Carolina State Health Plan’s Board of Trustees voted at its May meeting to make changes to the plan to address a $507 million budget shortfall.
The State Health Plan (SHP) has approximately 750,000 members who have not had premium or benefit adjustments over the past seven years. That freeze is part of the plan’s cash deficit issue, which led the board to consider an average premium increase of $30.
“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,” N.C. State Treasurer Brad Briner, who chairs the board, said in a press release. “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 May 2025 fact sheet released by the SHP through Briner’s office said, “The goal is slow and steady changes over time to increase the Plan’s cash reserves and avoid large deficits like the one we’re in now,”
The board introduced a new “Preferred Provider program” to replace the current Clear Pricing Project, which increased reimbursement rates for services like primary care and behavioral health while reducing member copays. The Clear Pricing Project will end on Dec. 31.
Originally projected to cost $100 million for two years with no ongoing expenses, the Clear Pricing Program has significantly exceeded budget expectations, according to the treasurer’s office.
Beginning in 2026, SHP will implement a “bundle program” offering reduced out-of-pocket costs to members who choose preferred providers or facilities participating in bundled payment arrangements.
The bundle program targets specific service areas, including orthopedic procedures.
The cost-sharing differential is designed to incentivize members to select bundle-participating providers to help control expenses for both members and the plan. The SHP board will vote on implementation flexibility in the coming months.
The board also approved benefit changes for active, non-Medicare members enrolled in 70/30 and 80/20 plans. Those plans will be renamed “Standard” and “Plus” plans, respectively. Each plan features different deductibles, out-of-pocket maximums and copay structures for various services. Under the “Standard” plan, deductible rates will increase from $1,500 to $3,000.
Changes are also coming for more than 197,000 Medicare-eligible members in the state.
According to the fact sheet, splitting the Medicare Advantage Plan medical coverage and prescription drug plans while maintaining both through Humana will save the plan $70 million in 2026.
There are three plans for those members, including two Medicare Advantage plans offered by Humana and the Medicare Retiree Base PPO Plan, formerly called the 70/30 plan. The latter may be altered to include a higher out-of-pocket cost and a higher deductible.
Medicare Advantage Plan members won’t see any benefit changes but will have an increase of $100 in the out-of-pocket pharmacy maximum and receive two separate ID cards and enrollment confirmations for each component.
Key future actions and deadlines include determining premiums in August and conducting open enrollment from Oct. 13-31.
More information can be found at shpnc.org.
