A State Employee’s $8,000 Baby: Decent health plan or just limited catastrophic coverage?

In the current debate over the changes to the NC State Employees and Teachers’ health plan, some policymakers have asserted that the NC State Plan is as good or much better than plans available in the private sector.  A look at the data from the most recent comprehensive survey of private employers shows this simply isn’t true.

State employees and teachers pay much higher cost sharing amounts than the average worker in private industry at a large firm in the South.  In this context, whether state employees pay a new monthly premium or not – one of the more visible issues – is increasingly irrelevant.  The real cost in the plan is the enormous cost sharing required.  For example, if a state employee decides to have a baby and has the bad judgment to be pregnant in July and so must meet cost sharing in two plan years, total costs to the employee could easily be $8,000 for a birth with a few complications in the hospital.

Type of Cost Sharing Average PPO Plan in the South (large firm)

Proposed changes to NC State Employees’ Health Plan (S265)

Annual deductible $460 $700
Annual out-of-pocket maximum coinsurance Less than $2,500 for most workers $3,210
Primary care co-pay $22 $30
Specialty co-pay $31 $52-$70
ER visit co-pay $109 $233
Average monthly premium $71/mo $22/mo

Source: Kaiser/HRET Survey of Employer-Sponsored Health Benefits, 2010 http://ehbs.kff.org/; NC Senate Bill 265, NCGA 2011;  NC State Health Plan Benefits Booklet 2010.


  1. […] Searing includes a chart that compares the numbers. Have a look here. […]

  2. Alex O.

    March 27, 2011 at 9:02 pm

    I just did my taxes. My out of pocket costs were higher than my premiums as the spouse of a State Employee. I spent way more on medical than mortgage and never met all my deductibles, etc.

    Next year it will be catastrophic insurance. I was recently asked about my experience with ERs and urgent care centers. I said I never go. The interviewer asked why and I said simply cost. Next year we can ad Specialists.

  3. KB

    March 28, 2011 at 2:03 pm

    Changing the health insurance from bad to horrible will be the last straw for me. Like other state employees I haven’t had a raise in three years and am constantly the whipping boy of so called “conservatives” who don’t care about anything but profits. I am sick and tired of it but with the lovely unemployment rates in the area there is no where else for me to go right now.

  4. Adam Searing

    March 28, 2011 at 2:06 pm

    Don’t worry KB! GOPers are just about “jobs, jobs, jobs” in their work in the General Assembly, so I’m sure everything will be fine.

    Of course they have been spending an awful lot of time on “repealing” national health reform, charter schools, gun rights, and putting North Carolina on the gold standard while we issue our own state currency….hmmmm.

  5. CB

    March 29, 2011 at 12:13 pm

    I work at UNC and right now feel like I will need to start looking for another job. No raise in 3 years, parking rates continue to increase, charge us for our insurance AND go up on our co-pays and deductibles! People think State Employees have it made but I can promise you that most of us work for hard for a small paycheck that continues to get smaller each year even though the cost of living is rising. That does not happen in the public sector!!

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