State News

Head of N.C. employee health plan fired

Posted July 2, 2008
Updated July 3, 2008

— The executive administrator of the state employee health insurance plan has been fired abruptly after a legislative leader said the plan failed to meet its fiscal goals.

George Stokes was fired after three years at the helm of the North Carolina State Health Plan. A spokeswoman for state Insurance Commissioner Jim Long said he fired Stokes after being told to do so by lawmakers who oversee the plan.

Former administrator Jack Walker would take over leadership of the plan.

House Majority Leader Hugh Holliman and Senate Majority Leader Tony Rand wrote to Long on Tuesday asking for Stokes' termination.

Holliman said Stokes was removed because the General Assembly expected to receive a $50 million surplus from the plan this year. Plan officials told him last week there would be a $65 million shortfall instead.

"We had some financial setbacks in the plan," Holliman said. "This was a surprise, and we just didn't feel like we were kept informed like the way we should and things weren't going in the right direction."

The State Health Plan provides medical insurance for almost 650,000 state workers, public school teachers and retirees. It also administers N.C. Health Choice, which provides coverage for 122,000 uninsured children statewide.

Plan employees were told of Stokes' firing Wednesday afternoon, said spokeswoman Linda McCrudden, who said she had no immediate further information.

Holliman said the fiscal turnaround for the plan won't affect this year's budget for the health plan, but it could affect the 2009-10 fiscal year, potentially in the form of higher premiums.

"We have been operating under projections which cannot be met. This has placed us in a very difficult position and one that needs immediate attention," Holliman and Rand wrote in their letter.

State law gives the committee's leaders the final say over hiring and firing, although Long carries out their wishes, Department of Insurance spokeswoman Chrissy Pearson said.

"The commissioner has no say at this point," she said.

Stokes didn't immediately return a phone call Wednesday. During his tenure, Stokes initiated new, less expensive managed-care insurance options starting in late 2006 that became quite popular with employees.

But the plan faces several long-term challenges, including the costs of covering future health care expenses for retired state employees, which has been estimated to exceed $20 billion.


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  • YeahISaidIt73 Jul 3, 2008

    You know you state employees really want something for nothing. For the ones that said the state health plan suckss. Even before they went to a ppo plan and it was just a comprehensive major medical it was still a good plan. For one if you were an employee you did not have to pay for your coverage. And the deductible was only $300.00. Now you have a choice and you can get a deductible as low $150.00 for $43.00 a month for a single employee only. People have the misconception that this is a BCBS plan when BCBS only adminsters the plan. The crooks that you vote into office determines each year how much you will pay, what your benefits will be, and what your limitations will be. You have it good and you just dont know it. You need to prices some other insurnace companies and stop whining. My deductible is 1000 dollars and i pay more than 43 dollars per month. You guys are the worst.

  • spartanpirate Jul 3, 2008

    The State Health Plan is not for profit. They have to pay BCBS a per member per month premium in order to have them administer the plan. Claims are paid through BCBS but are taken out of funds that the State Treasurer holds for the SHP. In the beginning of the second year of the bienium budget there should be a surplus since premiums were estimated to cover 2 years and not only the first year. Costs for healthcare go up each year, therefore the need to have a surplus at the beginning of the second year. At the end of the second year there should be enough funds left to cover claims that were incurred through June but paid out in the next bienium.

    Funny how Dr. Walker recognized this and brought the SHP up from the red to the black during his years there. People don't like him because they didn't have a "choice" in coverage but look at what has happened now.

    I applaud Dr. Walker for being willing to step in when he is needed and you should too if you are a state employee.

  • Beachnut Jul 3, 2008

    Mere incompetence will never get you fired from your govt. job. But make your political bosses look bad in public... you're gone in a New York minute!

  • paul234918 Jul 3, 2008

    The state does NOT get a "Deal" for it's employees and it DOES detract from one's paycheck regardless of how it is accounted for. I bought my own health insurance through BC/BS for several years before becoming a state employee. The exact same coverage and benefits went from $150/month out of my pocket to a, claimed by the state, benefit provided to me of $384/month. I would rather buy my own and still have the extra $134 (Two+ tanks of gas!) in income every month. Yes the state is wasting money and yes fellow employees, it does cost you money, also.

  • resraleigh Jul 3, 2008

    The only ones getting increases in Raleigh are the governmental workers. There are better educated, harder working individuals who are "living the dream" that is Raleigh generating revenue through taxes, fines and more taxes for endless governmental employees and their benefits. Maybe before everyone else is asked to pay more to pick up their shortfall, it's time for Raleigh to really actually examine all the money spent that doesn't benefit know, those people paying for the governmental workers.

  • gordonbabe Jul 3, 2008

    Funny thing is... don't we ALL expect that after they speak of raises & cost of living increases(no matter how small) that they always go UP on the premiums for insurance? This is no surprise. Just another way for them to justify going up on the insurance premiums for State Employees.

    Of course they HAVE to give us a raise... just to cover the amount that the insurance is going to go up! Funny thing is that it probably still won't cover it. Why should we expect any less! (or more from Easley)

  • NCTeacher Jul 3, 2008

    The only thing good about the State Health Plan is that they don't take money out of my paycheck to cover me. That is what makes it good insurance. However, when I looked into adding my husband it would have taken $400 a month out of my paycheck. What a crock. The price of adding a spouse AND child was actually about $50 cheaper per month.

  • tarheelalum Jul 3, 2008

    How dare a health care plan actually save the insured money and thus leave less for profit!

  • hollylama Jul 3, 2008

    Mobile I'll have to somewhat agree with you. I know people in Denmark (the "happiest" place on Earth") and they complain about their socialized health care system.

  • revolutionary Jul 3, 2008

    I'm still trying to grasp the concept of a state health plan being for profit. Blue Cross Blue Shield is supposedly not for profit. Yet the CEO rakes in millions in bonuses annually. Check out the wake county government real estate site and look at his home. All this from a not for profit company? I suggest you state workers get on the ball and start asking some serious questions regarding accountability. I guarantee Mr. Stokes is simply a scapegoat.