Today’s meeting of the Committee on Employee Hospital and Medical Benefits included a financial update of the State Health Plan (SHP). Among the highlights:
- For FY 2009-10 recently completed, the SHP had a net loss of $42.7 million – meaning that it paid out nearly $43 million more than it collected in revenue from premiums, co-pays, etc. Remember, most of the SHP premiums are paid by the state courtesy of your tax dollars. The $42.7 million loss was lessened in part by $52 million in premiums being prepaid – out of the rapidly sinking state retirement system.
- Updated projections for the current fiscal year 2010-11 that started July 1 suggest total expenses for the Plan to be $52 million higher than allotted in the state budget – where will that money come from?
- Estimates for the 2011-13 biennium include a 10.7% premium increase each year, putting heavy upward pressure on funding requirements
- The premium increases are projected to require an additional $717 million total in funding over the 2011-13 biennium, $572 million for General Fund supported employees alone. Most of this additional burden will necessarily be borne by taxpayers.
Something’s got to give with the State Health Plan – soon. The State Health Plan’s unsustainable condition just further reminds us of the growing divide between North Carolina’s haves and have-nots.