A letter from the N.C. Association of Educators to state Treasurer Dale Folwell may have been the tipping point in resolving the State Health Plan’s network coverage dispute for 2020.

Thursday, the SHP and Folwell ended their controversial attempt to compel the state’s 126 hospitals to sign a contract requiring reduced rates for reimbursement.

The goal was making the Clear Pricing Project plan the only in-network option for the state health plan.

The NCAE letter, sent Wednesday by President Mark Jewell, pointedly described the group’s worries about public school educators and staff potentially having to pay higher costs for out-of-network health care, or having in-network options not accessible, particularly in rural areas.

The NCAE represents 165,000 public-school educators and about 260,000 SHP participants overall when counting family members, or about 36% of the 727,000 participants.

“SHP members are rightfully frightened and frustrated at the lack of information coming out of your office, and we feel strongly that it is time to stop playing political games and put the best interests of members first,” Jewell wrote.

“N.C. educators need you to do your job, so they can concentrate on doing their jobs.”

The SHP and Folwell agreed to retain Blue Cross Blue Shield of N.C.’s Blue Options network for 2020, as well as the CPP network for five hospitals and 27,000 providers.

The hybrid network was unveiled just three days after a second CPP sign-up period ended Monday with just one hospital joining, and only five overall. The first sign-up period ended July 1.

Frank Lester, spokesman for the treasurer’s office, said Friday he did not believe the NCAE letter played a role in the 2020 SHP coverage network plan, but deferred comment to Folwell, who could not be reached.

On Friday, Jewell released a statement saying “we are relieved that all SHP participants will have access to quality, affordable health care next year, and that our members will not have the prospect of their local hospital or doctor being out-of-network hanging over their heads as they prepare for the start of the upcoming school year.”

“It appears the combination of the Blue Options network and the new State Health Plan network will give members sufficient choice and access for their health care needs.”


Folwell launched in October his attempt to move the SHP to a government pricing model tied to Medicare rates via the CPP contract.

Hospitals and medical providers that did not sign the contract could have become out-of-network for SHP participants on Jan. 1.

Jewell told Folwell that the NCAE “shares your concerns over the billing practices of hospitals and health systems. We share your vision for a more transparent and open health-care marketplace, and also agree that steps must be taken to save the SHP money wherever possible.”

“Unfortunately, both of these laudable goals are now in jeopardy as a result of the flawed CPP strategy and implementation.”

Jewell wrote of NCAE’s concerns intensifying “given the revelations of the past week. ... that the Oct. 1 open enrollment date has been suspended until a date ‘that has not yet been finalized.’ It is clear that your office has not sufficiently planned for this outcome.

“With only (five) hospitals signed onto the program, and the largest health systems completely absent from the program, there would be hundreds of thousands of SHP members who are functionally unable to access quality, affordable, ongoing medical care within a reasonable distance of their home.”

Jewell asked Folwell to “fully explain your proposed solution to the current impasse, including a detailed timeline for implementation.”


The combined hybrid network will have more than 68,000 in-network providers. Blue Cross is the third-party administrator of the SHP.

The SHP said the combined network “is designed to comply with access to care requirements for hospital coverage.”

“For members, this means they will continue to have access to the provider network they utilize today, along with some new providers that were not previously part of the Blue Options network” after those providers signed the CPP contract.

The N.C. Healthcare Association conducted a statewide public-relations campaign against the reimbursement contract, targeting Folwell’s role in the initiative. That included lobbying Gov. Roy Cooper and legislative leaders of both parties. The legislature has given the state treasurer the authority to negotiate SHP contracts.

“While the specific benefit design for this plan has yet to be seen, this move will help maintain access to in-network care for them (SHP participants),” the NCHA said in a statement Thursday.

“NCHA and our members look forward to working with the treasurer and the General Assembly to develop a stronger, sustainable, transparent future for the State Health Plan.”

Folwell stressed in Thursday’s statement that “the Clear Pricing Project is just the beginning” of his efforts to reduce health-care costs.

Folwell said that by the NCHA “spending millions of dollars to oppose us and by using cartel-like tactics, these organizations were able to convince most hospitals to boycott the State Health Plan.”

“If big hospitals could do this to their largest customer, just think what they can do to the individual average citizen or business.

“We’re in a medical arms race in North Carolina,” Folwell said. “Every dollar unnecessarily or inefficiently spent on health care is a dollar that can never be spent on education and other core functions of government.”

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rcraver@wsjournal.com 336-727-7376 @rcraverWSJ

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