(RALEIGH, N.C.) – State Treasurer Dale R. Folwell, CPA, announced that the North Carolina Court of Appeals issued a ruling yesterday upholding the state's position in Lake v. North Carolina State Health Plan for Teachers and State Employees, et al. The ruling said, in part, “…retired state employees are promised nothing more than equal access to health care benefits on an equal basis with state employees."
The original suit was filed in Gaston County Superior Court in April 2012 by 26 retired teachers and state employees. The Plaintiffs had successfully moved for class certification; the class currently exceeds 220,000 retirees. The main issue is whether the state, under the previous treasurer, had wrongfully charged a small monthly premium to retired employees for the State's 80/20 health plan option. The other option, a 70/30 plan, has always been premium free.
Plaintiff's lawsuit could have forced the state to analyze tens of millions of individual medical claims over the last several years, potentially costing hundreds of millions and adding billions to the state's unfunded health care liability.
“We are pleased with the ruling by the Court of Appeals," said Treasurer Folwell. “However, this does not change our focus. We are committed today, yesterday and tomorrow to sustaining the State Health Plan for current employees, retirees and future generations of public service workers - including many retirees who originally filed this case and of whom I know personally."
Folwell added praise for Solicitor General Matt Sawchak and his team at the NC Attorney General's office as well as attorneys with the State Health Plan whom he noted had worked tirelessly in preparing and arguing the case.
“We are very fortunate to have Solicitor General Sawchak and the other attorneys working on this case. I know they put in a lot of hard work and it shows in the unanimous decision. They did a masterful job of protecting the hundreds of thousands of State Health Plan members, some of whom cannot afford family premiums and who would have suffered with a plan that was even more insolvent," Folwell said.
The State Health Plan, a division of the N.C. Department of State Treasurer, provides health care coverage to more than 720,000 teachers, state employees, current and former lawmakers, state university and community college personnel and their dependents, including non-Medicare and Medicare retirees.
Link to Treasurer Folwell's Letter to the North Carolina General Assembly on Lake nearly two years ago.