State health plan redesign will raise premiums and out‑of‑pocket costs for most Wake County employees, benefits staff say

Wake County benefits staff told the Budget & Finance Committee on Oct. 28 that changes the North Carolina State Health Plan will implement in 2026 are expected to increase premiums and out‑of‑pocket costs for a majority of district employees.

"One of the key takeaways here is that with the exception of some of behavioral health and occupational physical therapy services, out‑of‑pocket expenses are increasing across the board next year regardless of which plan you're enrolled in," said Chad Hegley, director of benefits.

Hegley reviewed two overlapping open‑enrollment periods: state‑plan elections close Oct. 31 and other benefit elections close Nov. 7. He said Wake County will offer a long‑term care option, an updated accidental coverage product and eight guaranteed‑issue benefits for 2026. The district also increased the dependent‑care flexible spending account limit to $7,500 for 2026 and the health‑care FSA limit to $3,300.

On plan design, Hegley said the standard (70/30) PPO will see larger deductible increases (examples given: roughly $1,500 higher for single coverage and $4,500 higher for family coverage in the standard plan) while the plus (80/20) PPO faces smaller increases but higher premiums. He also listed programs the plan will discontinue, including Teladoc services and the tobacco‑attestation wellness credit.

Hegley described the state health plan’s new salary‑based premium bands and presented a district enrollment snapshot: nearly 70% of Wake enrollees are in employee‑only coverage, most staff fall in the first three salary bands and about 6% earn $90,000 or more. Based on current enrollment and coverage choices, Hegley said roughly 84% of current participants would see premium increases next year if they remain in the same plan and coverage; about 16% would see decreases. He added that roughly half of those who will see increases work in non‑certified positions and that the combination of higher premiums and higher out‑of‑pocket costs could yield net pay reductions for some employees.

Committee members asked for concrete examples. Hegley used figures from the district handout to illustrate sample impacts: a beginning teacher whose total pay (state base plus local supplement) places them in the lowest premium band would see a modest monthly premium increase for employee‑only coverage (an example cited was about $10 per month under the 70/30 plan), while employees in higher bands or with family coverage could see larger monthly increases.

Board members also asked whether the salary used for banding included local supplements; staff confirmed the state‑plan banding is based on gross pay that includes state base plus local supplements as reported to the state.

Staff outlined a communication plan that included on‑site enrollment assistance, supplemental handouts and webinars through the close of the open‑enrollment windows. Hegley and benefits staff said outreach will emphasize plan comparisons and the effect of salary bands on premiums.

Provenance: benefits staff made the presentation and answered board member questions on Oct. 28; the state plan changes, salary‑based premium bands and projected enrollment impacts were presented beginning at the State Health Plan presentation.