by Michelle Crouch and Charlotte Ledger, North Carolina Health News
October 7, 2026
Key Takeaways:
- Atrium announced a program that will cut copays and deductibles for State Health Plan members who use its doctors.
- But Treasurer Brad Briner says the health system will still charge the State Health Plan higher rates, driving up costs. His office is investigating legal options.
- Critics say the program undermines cost-control efforts, while some local officials praised it, citing employee concerns about keeping their doctors.
By Michelle Crouch
Atrium Health announced a program Tuesday that aims to lower out-of-pocket costs for members of the health insurance plan for state employees who want to keep their Atrium doctors. But the announcement drew a blistering response from state officials who called it “trickery” that would ultimately cost plan members and taxpayers more.
“If this Atrium program remains in place, it will bankrupt the State Health Plan,” said North Carolina Treasurer Brad Briner, whose office administers the plan.
Briner told The Ledger/NC Health News he believes the Atrium program is illegal, and his office is investigating legal options. He urged state employees to disregard Atrium’s announcement as they prepare for open enrollment for health insurance that begins on Monday, saying he did not think Atrium’s plan would take effect.
The dispute is the latest flareup in a tense relationship between the treasurer’s office and Atrium Health as State Health Plan officials try to rein in health care spending.
The State Health Plan covers nearly 750,000 state employees, retirees and dependents. As part of an effort to dig the plan out of a $1.5 billion deficit, plan officials created a tiered provider network for 2027 that rewards members with lower costs if they use “preferred providers” that agreed to charge significantly lower rates.
After a competitive yearlong process, Atrium was not selected as a preferred provider. That meant members who wanted to keep using their Atrium doctors faced higher copays and deductibles unless they switched to one of the plan’s lower-cost preferred providers: Novant Health, UNC Health or Iredell Health.
The decision frustrated many members, particularly in Charlotte, where Atrium has a dominant presence.
Atrium’s new “Affordability Protection Program,” announced in a news release Tuesday, would lower copays and deductibles for State Health Plan members who use Atrium doctors and facilities — in some cases, to less than they would pay if they visited the plan’s preferred providers.
“We didn’t want our patients to have to choose between the care team they trust and affordability,” said Steve Smoot, president of the North Carolina and Georgia Division of Atrium parent Advocate Health, in the news release.
Briner said the problem is that Atrium is not lowering the prices it charges the State Health Plan. Atrium will be the highest-cost major health care system in the state in 2027, Briner said, and if large numbers of members keep getting care there, it could cost the plan more than $100 million next year.
To cover those costs, Briner said, the State Health Plan would have to charge higher premiums for everyone and ask the legislature for more money.
“It may feel good for our members in the short run to save a couple dollars, but it will cost all of us thousands of dollars in the long run,” Briner said. “The only winner in this proposal is Atrium.”
Bob Berenson, a physician who is a fellow at the Urban Institute, a Washington, D.C. policy think tank, said Atrium’s plan sounds like an inducement to undermine the health plan’s efforts to steer patients toward cheaper care.
“They are basically subverting the creative approach that the State Health Plan has adopted to try to rein in health costs for their members,” he said.
Berenson said it’s similar to how pharmaceutical companies offer coupons to cover a patient’s copay for an expensive drug, making it cheaper for the patient and encouraging those patients to not use a cheaper generic. Meanwhile, the health insurer still pays the brand name drug’s higher price.
“People may not understand this, but the reason the U.S. has spent so much on health care — and that’s a particular problem in North Carolina — is because of this kind of behavior by a powerful health system,” Berenson said.
Public dispute, private talks
As the State Health Plan has faced mounting financial pressure, officials have worked to stabilize the program by raising premiums, increasing deductibles and launching the tiered provider program that goes into effect in 2027. The tiered rates are designed to steer more patients to health care systems that have negotiated lower prices with the plan in exchange for a higher volume of patients.
When the tiered plan was announced in July, listing Atrium as a more expensive “non-preferred” provider, Atrium publicly objected to how the process had unfolded. The system said it was “deeply concerned” about being placed in the non-preferred tier and complained that it was “never engaged to compete for the full scope of services.”
The treasurer’s office fired back by comparing Atrium to a “a World Cup team that loses and immediately blames the referee,” adding: “You automatically put yourself in the (L) column if you don’t ever enter a bid.”
After that public dispute, the two sides eventually met at the negotiating table. Weeks of talks resulted in an agreement that moved Atrium’s rural and children’s hospitals into a lower-cost middle tier in a deal that was announced in mid-September.
Briner said “the ink was still drying” on that agreement when his office learned about the new Atrium program from a news release Tuesday morning. The timing was especially frustrating, he said, because open enrollment for state employees to choose their health insurance for 2027 starts Monday.
“Raising something like this at the time they did it, and in the way they did it, is not how I’d ever approach any partnership,” he said. “I know exactly what Atrium is trying to do. They don’t like losing.”
Briner said he and his board reached out to people at all levels of Atrium and its parent Advocate Health, including CEO Gene Woods.
“He doesn’t understand why we did not accept Atrium’s late proposal that is not as good as Novant’s, and he wants to re-litigate that,” Briner said. “We ran a fair and transparent process. They lost. We need to be people of our word around processes that we run. Otherwise, no one will believe us in the future.”
Atrium said in its news release that it created the affordability program after submitting several proposals that were not accepted, including an offer to match the pricing of preferred providers.
“While we can’t control the tier designation assigned by the State Health Plan, we can take action to ensure our dedicated public servants across the state are not left to face the consequences of these decisions,” Smoot said.
Sen. Jim Burgin (R-Angier), who co-chairs the Senate Health Care Committee, said he wasn’t familiar with the details of the new Atrium program, but he said “if their intentions were pure, they would have called the treasurer and worked this out.”
“If it’s such a good idea, why doesn’t Atrium do it for everybody?” he said. “I look forward to Gene Woods making it available to every employer.”
Mixed reaction from state employees
The Atrium news release included a long list of local public officials praising the program, including Mecklenburg County District Attorney Spencer Merriweather, Charlotte-Mecklenburg Schools interim superintendent Melissa Balknight, other school system superintendents and community college presidents.
Merriweather told The Ledger/NC Health News that Atrium contacted him to ask about putting his name on the news release. He said he agreed because he has heard from many employees worried about having to switch doctors or pay more to keep them, including a pregnant woman who was worried she would have to switch away from her Atrium doctor. (Note: The plan does offer an exception for that circumstance.)
“A lot of people in my office were freaking out about this notion of a tiered system,” Merriweather said. “To be honest, anything you can do to keep people with the doctors they’ve got, all the better.”
He said he was not up to speed on the “nuts and bolts” of Atrium’s negotiations with the State Health Plan, but that “this whole back and forth has been a concern to my employees.”
Ardis Watkins, executive director of the State Employees Association of North Carolina, called the program “smoke and mirrors at best.”
If Atrium’s underlying prices remain higher, she said, the State Health Plan and the General Assembly will still have to cover those additional costs — and that will eventually affect state employees through higher premiums or less money available for raises.
“Simply make your prices more reasonable and less outrageous, and these gimmicks would be unnecessary,” Watkins said.
Shekeya Davis, 53, a state employee who works in adult corrections in Charlotte, agrees that employees who have spent years building relationships with their doctors should not have to pay more to stay with them.
Yet she, too, worries that Atrium’s program won’t stop health care costs from rising.
She said the dispute between Atrium and the State Health Plan “is a disservice to state employees,” she said. “You have the state employees being caught in the middle.”
NC Health News editor Rose Hoban contributed to this story.
This article is part of a partnership between The Charlotte Ledger and North Carolina Health News to produce original health care reporting. You can support this effort with a tax-deductible donation.
This <a target=”_blank” href=”https://www.northcarolinahealthnews.org/2026/10/07/atrium-affordability-program-state-health-plan/”>article</a> first appeared on <a target=”_blank” href=”https://www.northcarolinahealthnews.org”>North Carolina Health News</a> and is republished here under a <a target=”_blank” href=”https://creativecommons.org/licenses/by-nd/4.0/”>Creative Commons Attribution-NoDerivatives 4.0 International License</a>.<img src=”https://i0.wp.com/www.northcarolinahealthnews.org/wp-content/uploads/2021/10/cropped-favicon02.jpg?fit=150%2C150&ssl=1″ style=”width:1em;height:1em;margin-left:10px;”>
<img id=”republication-tracker-tool-source” src=”https://www.northcarolinahealthnews.org/?republication-pixel=true&post=70068″ style=”width:1px;height:1px;”><script> PARSELY = { autotrack: false, onload: function() { PARSELY.beacon.trackPageView({ url: “https://www.northcarolinahealthnews.org/2026/10/07/atrium-affordability-program-state-health-plan/”, urlref: window.location.href }); } } </script> <script id=”parsely-cfg” src=”//cdn.parsely.com/keys/northcarolinahealthnews.org/p.js”></script>
Source: www.northcarolinahealthnews.org
