RALEIGH — The State Health Plan Board of Trustees approved a plan for premiums based on salary bands for the plan’s 750,000 members, consisting of state employees, teachers and retirees, at its Aug. 15 meeting.
State Health Plan (SHP) premiums have not been raised over the past seven years, and premiums have been kept constant mainly due to the use of cash reserves to make up the difference.
The $100 million for the SHP in the legislature’s minibudget will help somewhat, but the reserves are almost gone, and the SHP is facing a shortfall of $507 million unless changes like the new premium plan are made.
“Today’s vote was not easy, but these increases were necessary to keep the Plan solvent and to keep this benefit in place for those that serve and have served the state of North Carolina,” North Carolina Treasurer Brad Briner said in a press release. “The goal now is to move forward and focus on ways to improve benefits through transparency and better partnerships and programs to keep our members healthy.”
The new premium rates go into effect Jan. 1, 2026, and fall under four salary bands: under $50,000, $50,001-$65,000, $65,000-$90,000 and $90,001 and over. The N.C. State Department of Human Resources’ most recent data shows the average median salary of state employees is $57,000.
Each band has sub tiers for the premiums by enrollee levels: subscriber only, subscriber plus children, subscriber plus spouse and subscriber plus family.
The new rates have monthly premium increases of between $25 and $50 for lower banded salaries. Higher salary band employees will see the largest premium increases, which could be almost triple their current premiums.
A standard PPO Plan premium for just a subscriber making under $50,000 will be $35 and is the least expensive option. The most expensive option for the same plan is $620 for a subscriber plus family where the subscriber makes $90,001 or more.
For those enrolled in the Pro PPO Plan, premium rates are similarly banded. For the single subscriber making under $50,000, the rate is $66. The subscriber plus family for individuals making more than $90,000 is $840.
Those who opt for child coverage may see their rate decrease or remain at the same rate. Similarly, retiree coverage should remain stable except for prescription costs, which could rise.
The SHP has also instituted a partnership program called Lantern for members who use certain surgeons with whom the SHP has negotiated a below normal rate. Plan director Tom Friedman indicated state employees following that program could pay nothing or very little for surgical procedures.
More information will go out to SHP members on benefits and premium rates before the 2026 open enrollment period on Oct. 13-31.
