Looks like North Carolina’s State Health Plan, which provides over 650,000 current or retired state employees with health benefits, may need and infusion of cash. According to WRAL, the executive director of the plan has said that in next few years, the plan requires at least an additional $400 million in cash. An outside consultant says that the plan needs to restructure and rework contracts to limit expenses.
Total expenses for the State Health Plan exceeded $2.5 billion in 2009 and are projected to cost the state $1.8 to $1.9 billion above current costs from 2011 to 2015. Surely, the plan must be reworked to maintain a sustainable fiscal outlook.
In addition to rising costs for the State Health Plan, per capita state debt has more than doubled in the last 10 years from $320 per capita to $768. Furthermore, the state pension requires hundreds of millions of dollars more to fund its obligations. It is this type of fiscal forecast that reveals North Carolina’s structural budget issues which should lead to austere budgets in the coming years. Read more about North Carolina’s oncoming fiscal tsunami here.