North Carolina State Treasurer warns of health plan deficit, plans first premium hike in nearly a decade

• The previous state treasurer, Dale Folwell, warned that as soon as 2026 the State Health Plan might not be able to meet its financial obligations without financial assistance from the N.C. General Assembly, as drug prices continue to increase and COVID-related expenses linger.

Driving the news: It's with that financial shortfall in mind that the state could increase premiums for those in the State Health Plan for the first time in nearly a decade, said Briner, a Republican.

• The State Health Plan board is also considering setting those premiums differently for employees based on their salary.

What they're saying: "We've got to make this plan balanced, and we've got to make it balanced essentially now," Briner said.

• "But we are still left with a hole and that's where we get to the conversation where we're going to have to ask state employees to increase their premiums for the first time in eight years," he added.

Zoom in: Briner noted that premiums have been held at $25 per month, and that the number is likely to go up to $45 per month for workers making the lowest salaries.

• "It's not something we relish doing," he said, "but in the end, we've got to make sure the State Health Plan is solvent in the long run."
• Some critics of Briner's plan noted that the State Health Plan's low cost is one of the biggest attractions to recruiting workers into state government, and that raising premiums will make government jobs less attractive.
• "I think the state health plan remains, even at $45 a month, one of the best deals in healthcare you can find," he said in response. "And we've gotten a little lost in the narrative of premiums having to go up, but they're going from very low to low."

In response to rising costs, the State Health Plan under Folwell's administration stopped covering expensive weight-loss drugs like Ozempic and Wegovy.

• Briner said he's been hopeful of reinstating coverage of weight-loss drugs, but it might take the introduction of competitor weight-loss drugs and lower prices before it can.
• "Is that in 2026 or 2027? That's the question," he said. "We've got to figure out how and when we do that."
• He also wants the State Health Plan to get to a point where it can determine whether the drugs are being administered for health reasons or aesthetic reasons. "The problem that we found ourselves in a year ago was that we couldn't distinguish between those two populations," he said.

State of play: Those aren't the only changes Briner — a former member of the UNC-Chapel Hill Board of Trustees and a former chief investment officer for Michael Bloomberg's family office — is making from his predecessor Folwell, also a Republican.

• Briner is also in charge of managing the state's $127 billion pension plan.
• During his campaign, Briner said he wanted to move the pension plan's management from a sole-fiduciary model — where the state treasurer makes the final decision on investments — to a model where a board votes on the decisions.

Briner said conversations with the General Assembly are ongoing, and he thinks there is a willingness to address the sole-fiduciary model, given North Carolina's pension plan has had some of the lowest returns in the country.

• "The question is: who gets appointed to the board in the end," Briner said. "And I've made appointments to the Investment Advisory Committee recently, of which I have four of those. Those are the caliber and type of people that we want to fill those trustee seats."

One of those investment decisions a future board might have to make is whether to invest in cryptocurrencies or not. A bill recently introduced by Republican House Speaker Destin Hall would give the treasurer the green light to invest in virtual currencies like Bitcoin.

• "I'm not sure I see a huge distinction between Bitcoin and gold," Briner said. "People argue that gold has industrial uses, and the truth is that's very, very minimal. It's mostly a store of value in the same way that Bitcoin is."
• But Bitcoin is a high-risk and highly volatile asset, he noted, while the state pension plan has historically been focused on lowering risk.
• "So I'm not sure that there's a perfect match there in risk and return expectations," he said, though he added a future investment board should set the aggregate risk of the pension's portfolio.