Treasurer, Hospitals At Odds Over State Health Plan

A debate is brewing over changes to the State Health Plan. Some say a new proposal would benefit state workers while putting the future of rural hospitals in jeopardy.

State Treasurer Dale Folwell believes hospitals are overcharging the roughly 700,000 people who have medical insurance through the State Health Plan.

Folwell spoke at a contentious legislative committee meeting on Tuesday. He told attendees that his proposed changes to how health care providers are paid could save taxpayers more than $700 million a year, with additional savings in out-of-pocket expenses for state employees.

The News and Observer reports that the North Carolina Healthcare Association opposes Folwell's plan, which is scheduled to take effect in January.

NCHA officials say those changes would amount to a 15 percent average cut to hospital budgets, and could force some rural hospitals to close, or leave the State Health Plan altogether.

Despite their differences, many at the meeting agreed that the current system might soon become unsustainable, and urged compromise between the treasurer's office and hospital representatives.