State employees, rural hospitals need protection in State Health Plan changes

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State employees, rural hospitals need protection in State Health Plan changes


I know many state employees are worried about proposed changes in the State Health Plan after a vast majority of hospitals this year did not signed on to the new plan introduced by the State Treasurer. I want to update you with all the information I have at this time.


Last year the State Treasurer announced the Clear Pricing Project (CPP) with the stated goal of saving the state $300 million in medical costs. He has full authority to determine benefits and pricing for the State Health Plan. I do, however, have concerns about the process.


The CPP tied provider reimbursements to a percentage of Medicare reimbursement rates. I have two concerns about the plan. First, the proposal would mean a significant loss of revenue for rural hospitals such as Appalachian Regional and Ashe Memorial. I’m also concerned that not all affected parties were properly consulted in creating the CPP.


In an attempt to deal with the controversy, the House in April passed the bipartisan HB184 that required all parties to come to the table to develop a better plan that would save the state the same $300 million in health care costs. Rep. Josh Dobson of Avery County was the primary sponsor, and I voted in favor of the bill. The Senate, however, has failed to act on it, so the bill has not become law.


Under the CPP, health care providers had until July 1 to sign up as “in-network” providers to the State Health Plan. Few hospitals did. The Treasurer recently announced that reimbursement rates would be modified slightly and that the deadline extended to Aug. 5. There are no signs any major hospitals will agree to the modified plan.


HB184 provides the best path forward to negotiate a reasonable solution, and there is still time for the Senate to act on it. Hospitals across North Carolina have pledged their willingness to find a better way to save the State Health Plan $300 million if brought to the negotiating table.


Thankfully there is still time to find a solution. Any changes in the State Health Plan will not go into effect until Jan. 1, 2020. I hope serious negotiations begin soon.

Most importantly, this issue is about the health of state employees and their families as well as their livelihoods. We must also find a way to protect the financial health of our rural hospitals.