Wednesday, January 4, 2023

Treasurer Folwell Announces Contract Award to a New Third-Party Administrator for the State Health Plan

Two Years from Now, in 2025, the New Contract with Aetna Will Bring Lower Costs, Transparency, and Generate $140 Million in Administrative Savings
Raleigh, NC
Jan 4, 2023

(Raleigh, N.C.) – State Treasurer Dale R. Folwell, CPA, and the State Health Plan (Plan) today announced the award of the Third-Party Administrative (TPA) Services Contract to Aetna. The Plan consists of nearly 740,000 teachers, state employees, retirees and their dependents. The administrative contract, awarded by the State Health Plan Board of Trustees, oversees health care spending of more than $17.5 billion over five years. The new contract reflects a partnership that focuses on transparency and lower costs, with the potential administrative cost savings over the course of the contract equaling $140 million. 

The three-year initial service period for the contract begins Jan. 1, 2025, and continues through Dec. 31, 2027, with the option to renew for two, one-year terms.

The award is the result of a Request for Proposals, a competitive bid process in which the Plan solicited and selected industry-leading partners providing exceptional customer service, technological resources and professional support. The services under the contract include processing claims and offering a comprehensive network of health care providers. Blue Cross and Blue Shield of North Carolina (Blue Cross NC) is the current TPA for the Plan and has been the TPA for over 40 years.

“We appreciate the years of service that Blue Cross NC has given our members. I’ve spoken with Blue Cross President and CEO Tunde Sotunde, M.D., and Board Chair Ned Curran, and they assure me that they will finish strong for the next two years,” Treasurer Folwell said.

“Partnering with Aetna, which already employs over 10,000 people in North Carolina, will create a lot of new opportunities for the Plan and the members we serve. A change of this magnitude is a great opportunity for a fresh perspective, and we look forward to working closely with Aetna to create new ways to provide price transparency, increase access and quality while lowering the cost of health care for those who teach, protect and serve, and taxpayers like them.”

Aetna was one of three companies bidding for the contract. Blue Cross NC and UMR, Inc. also submitted proposals.

Starting today, nearly 600 Aetna employees have been assigned to work on this transition with State Health Plan Director Sam Watts for the next two years. Aetna will be working diligently, in close collaboration with Plan staff and multiple vendors, to develop comprehensive plans and processes, systems and platforms to ensure members will enjoy a seamless transition when its services roll out.

Plan members will start receiving more information regarding the changes in 2024 prior to Open Enrollment for the 2025 benefit year.

The State Health Plan, a division of the Department of State Treasurer, provides health care coverage to nearly 740,000 teachers, state employees, retirees, current and former lawmakers, state university and community college personnel, and their dependents.