From Senate President Pro Tem Phil Berger’s office:

Republican Leaders Reach Compromise with Governor on State Health Plan

Raleigh, N.C. – Republican legislative leaders reached a compromise with Gov. Beverly Perdue Wednesday on sweeping changes to save the State Health Plan.

The compromise, HB 578, gives State Health Plan administrators the option to use available cash balance reserves in the upcoming fiscal year to offer a free coverage option to active state employees and teachers – at no additional cost to taxpayers.

The cash reserves are higher than previously expected based on recent forecasts.

“For years, the State Health Plan has been on the verge of financial collapse. Today’s compromise will ensure its future stability and manage health care costs for our teachers and state employees without raising taxes,” said Senate President Pro Tempore Phil Berger (R-Rockingham.)

Senator Tom Apodaca, one of the major architects of this legislation, praised the State Employees Association of North Carolina (SEANC) for supporting the plan. “I commend SEANC for their tireless efforts on behalf of our state employees,” he said.

The State Health Plan is more than half a billion dollars in the hole, and Republicans initiated steps in March to save it from financial collapse. The governor vetoed the original plan, despite its similarity to her own proposal.

Today’s compromise keeps most of provisions of the original bill, plus less expensive coverage for retired state workers on Medicare that was included in a later conference report.

The changes move the State Health Plan to the state treasurer’s office – the General Assembly currently is one of the few legislatures in the country that oversees state health benefits. The changes also require employees to pay a modest premium for the highest level of coverage, but keep costs for generic prescription drugs affordable.

The Senate Insurance Committee passed the compromise Wednesday morning. The Senate is scheduled to vote on the bill at its 3 p.m. session today.