Atrium Health says it will lower copays and wipe out deductibles and coinsurance for North Carolina State Health Plan members who get care at its facilities, starting Jan. 1, 2027. The announcement comes just weeks after the state plan placed Atrium entirely in its new “nonpreferred” tier, a designation that normally means higher costs for patients who go there.
A New Offer After a Tier Setback
Atrium Health announced its Affordability Protection Program on Tuesday, saying copays for primary care, specialty care, outpatient and inpatient services will come in lower than what members would otherwise pay even under the State Health Plan's top-tier Preferred rate, according to Atrium Health. The program is set to take effect for enrolled members at the start of 2027, and the hospital system says it has no set end date.
The move follows a rocky few months for Atrium within the state's new tiered network. As the Raleigh News & Observer reports, the State Health Plan named UNC Health and Novant Health as preferred providers back in July, while Atrium landed entirely in the nonpreferred tier — a category that typically carries higher out-of-pocket costs for patients. After negotiations in September, a dozen Atrium hospitals and associated clinics were shifted into the newly created Access tier, but major facilities including Carolinas Medical Center and Wake Forest Baptist remained nonpreferred, mostly rural and children's hospitals having been the ones moved.
What Members Would Actually Pay
Atrium's own materials lay out the math. For an example outpatient surgery that would otherwise require a $1,000 copay, a deductible of up to $5,000 and 30% coinsurance, the new program would bring a member's cost down to a $400 copay, the same report notes. Deductibles and coinsurance are waived entirely and replaced with the flat copay, and the discount is supposed to apply automatically when members are billed — no extra paperwork required.
For inpatient care at one of Atrium's urban hospitals, a similar scenario involving a $1,500 copay, a deductible of up to $5,000 and 30% coinsurance would instead be reduced to a $500 copay, per Atrium Health's State Health Plan page. The program applies at all Atrium locations and covers all State Health Plan members except retirees 65 and older who are enrolled in Medicare Advantage plans. Atrium says it created the program after hearing from thousands of State Health Plan members, and that it is absorbing the additional costs itself so members do not have to, though the system has not disclosed what it will ultimately charge the plan.
State Treasurer Pushes Back
Not everyone is cheering. State Treasurer Brad Briner said the State Health Plan was blindsided by Atrium's proposal, and he has raised alarms about what it could mean for the plan's finances. Briner reported that Atrium's move could raise the plan's total costs by 20%, 30% or even 40%, and separately told Business North Carolina it could become a multi-hundred-million-dollar problem for the plan. The State Health Plan is now reviewing whether Atrium's program violates its agreement or the law, and whether it conflicts with Atrium's contracts with Aetna, the plan's current third-party administrator, and Blue Cross NC, which is set to take over that role in 2028.
The stakes are real for the plan's bottom line: the state's report notes the plan pays the remainder of hospital bills after a member's cost-sharing is applied, meaning a cheaper copay for patients does not necessarily mean a cheaper bill overall. The plan has sought an extra $1 billion from members and the General Assembly over the past two years, and under the new tiered system, most members are expected to see premiums rise by about 5% in 2027, according to North Carolina Health News.
Atrium Says It Tried to Play by the Rules
Atrium maintains it tried the conventional route first. The system said it submitted multiple proposals starting in July asking the plan to give it preferred-provider discounts, all of which were rejected, and that it later renewed its offer to match preferred-tier pricing. Atrium also said it did not tell the State Health Plan about the new Affordability Protection Program during their weekly implementation discussions, a detail that has fed the treasurer's frustration over the surprise rollout.
Steve Smoot, an Atrium executive, said the program would protect public servants from the consequences of the plan's tier designation. Chris Berger, also with Atrium, said offering discounts directly to State Health Plan members is not unlawful. State law gives the State Health Plan authority to run the plan and set its benefits, and officials have said they will share more information with members this week during open enrollment.
Novant Health and UNC Health, reportedly carrying costs materially lower than Atrium's under the new tiers, and Iredell Health System were designated preferred providers. Members can use the State Health Plan's provider directory and Find a Doctor tool. The State Health Plan covers nearly 750,000 teachers, state employees, retirees and their dependents, and for many of them, the fight between Atrium and the treasurer's office will shape what they actually pay at the doctor's office come January.
