The clock is ticking on negotiations between health insurance company Aetna and Duke Health, which says that unless Aetna raises its reimbursement rates, many patients will lose in-network coverage to Duke’s doctors, hospitals, clinics, and services on Oct. 20, including over 750,000 state employees covered under the State Health Plan (SHP).

Aetna is the administrator of the SHP, which is the company’s largest customer in the state and is responsible for half of its member base in North Carolina.

Duke’s demands don’t sit well with State Treasurer Brad Briner, whose office oversees the SHP.

After the State Health Plan Board of Trustees voted unanimously last month to approve premium increases for 2026 due to a budget shortfall, he told Carolina Journal in a phone interview that the State Health Plan simply doesn’t have the money for another increase.

“We’ve got to have a strategy,” he told CJ. “So, we’ve spent a ton of time making contingency plans because Duke is asking for an unreasonable level and doesn’t seem interested in understanding the context of where the State Health Plan has found itself. It’s obvious to at least 10.9 million North Carolinians, but maybe not the rest of them that the State Health Plan has financial challenges and we’ve spent the whole year talking about those and trying to make them better and we finally have a good plan to get the provider community to help, and the legislature, and the members, and everyone’s understood that, and now we have one provider who is insisting on getting paid a lot more which we just don’t have. So, the amazing ability for them not to understand that has been quite a big part of the problem.”

In a letter on its website, Duke said that Aetna has not agreed to updated reimbursement rates that keep pace with rising health care costs and reflect the actual cost of providing patient care.

“Their current proposal would limit Duke Health’s ability to invest in technology, staffing, and essential patient services, which puts our community’s continued access to high-quality care at risk,” the statement continued. “Our ability to maintain high-quality, innovative care and attract top-tier clinicians and care teams depends on fair agreements with insurance companies. We are urging Aetna to prioritize our patients – their members – needs and allow them to keep their trusted Duke Health doctors in-network.”

Although he is quite used to reading financial statements, he encourages everyone to go to Duke’s website and pull their financial statements. He notes that you don’t need an accounting degree to see that the profitability of their nonprofit system is extraordinary.

“Duke is very good at many things, and so they’re a provider we absolutely want in network,” he said. “They provide amazing cancer care and cardiac care and a number of other things, and so, yes, we would love to have them in the network. The $600 million in change (in profit) last year tells me that they’re enjoying that and that apparently is not enough.”

The treasurer said that while he believes that companies need to be financially successful to be sustainable, Duke has most likely crossed the line when it comes to asking for too much.

In an emailed statement to Carolina Journal, Shelly Bendit, Senior Manager, Corporate Communications for CVS Health, which owns Aetna, said the company is committed to providing access to affordable, quality health care for its 1.5 million members in North Carolina.

“We are negotiating in good faith with Duke Health – a partner for several decades – to enable members to continue receiving in-network care at all of their locations,” she said. “We have a responsibility to offer a cost effective, quality provider network to our customers. Payment to providers participating in our networks directly impacts health care costs, and we have an established track record of working collaboratively with health systems in North Carolina toward fair and market-competitive reimbursement.”

Bendit further states that North Carolina has among the highest health care costs in the country, and Aetna is “unwavering in our effort to protect our North Carolina members from additional escalations in costs.”

In February, the State Health Plan Board of Trustees met to try and find a solution to the plan’s projected deficit—$507 million in 2026 and between $800 million and $900 million in 2027. 

On May 20, the board reconvened and approved changes to the SHP benefits, raising annual deductibles for singles and families under the 70/30 (Standard PPO) and 80/20 (Plus PPO) plans starting in the 2026 benefit year, which was necessary to keep the plan functional in the future.

Plan premiums for the first time are on a sliding scale based on income, with the smallest increases going to the lowest-paid state employees.

The scale is broken down into four income brackets: Under $50,000; $50,001 to $65,000; $65,001 to $90,000; and $90,001 and over. 

For employees earning under $50,000, monthly premiums for a single subscriber will rise by either $10 or $16, depending on the plan. In the top income tier over $90,000, that increase will be $30 or $110 per month. 

Retirees on the plan will see their monthly premiums remain the same. 

Briner told CJ he doesn’t know what else the State Health Plan can offer and expects Duke to accept the reality that the public pressure advertising campaign of constant ads is simply not going to work.  A similar situation happened last year between Duke and UnitedHealthcare.

“They do this over and over again, and they do it over and over again because it works,” the treasurer said. “But I’ve been very clear with anyone who wants to talk about that, including people from Duke, from Aetna, etc., that it’s not going to work because we can’t afford it. We literally don’t have the money. So, I would ask them to look harder at their cost structure, to dig deep into their many billions of investments, and figure out a better way than charging state employees more.”

One partnership that is off to a good start is providing lower costs to SHP members is with Lantern, a digital specialty care platform.

Briner talked about it at last month’s Council of State meeting. 

The new agreement with Lantern offers members no‑cost access to a vetted network of surgeons and specialists. Lantern also provides personalized support through dedicated care advocates and nurse navigators, while helping control costs for both members and the plan.

“This Lantern partnership shows real promise, and it has led to people bidding aggressively for our business, and that’s the situation we want to be in,” he told CJ. “So, we expect substantial savings. I won’t give you exact numbers because we’re early with a lot of the orthopedic procedures that we have throughout the state, and those are reductions in cost, and again, we have one provider asking for significant expansion.”

Briner said they will tentatively send a letter to members on Monday and email it the same day. It will primarily focus on those who used Duke primary care or any kind of medical procedure, including possible new providers of care if the agreement doesn’t work out.  

He stressed that for those who have acute care with Duke, such as being treated for cancer or being pregnant, they have a continuing care obligation that they have to cover by law.

If an agreement isn’t reached, new premium increases wouldn’t begin until 2027, but if a member chooses to see a Duke provider on or after Oct. 20, they would have to pay out-of-network costs.