Yesterday, Aon Consulting told members of a legislative committee meeting essentially what Adam Searing pointed out last year, North Carolina state employees are cheaper to insure than the average member of a ppo plan in the South. The consultant concluded that state employees in North Carolina had lower claims cost than state employees in Georgia, Tennessee, and Virginia.
So why does the State Health Plan need bailouts? Because it is mismanaged.
The administrative contract with Blue Cross drove the State Health Plan into the ground. The state could not estimate expenses because the Blue Cross contract was secret. And, as we learned in an audit last week, the State Health Plan is paying Blue Cross for corporate sponsorships and travel.
Again and again we see that high costs are not the primary culprit in bankrupting the State Health Plan. Certainly, we must do something about costs. Every health plan must deal with health care inflation. But first the State Health Plan must do something about its management.