Atrium Health to rejoin State Health Plan network in 2027 under multi-year deal

Under the deal, all Atrium doctors and facilities rejoin the State Health Plan network and join its Access Tier beginning in 2027. The plan describes the agreement as multi-year and says it effectively maintains 2026 prices for members. Atrium will stop offering the Affordability Protection Program it announced for plan members, and plan leaders will withdraw the lawsuit they filed in an attempt to stop it, WUNC reported.

The deal avoids up to $250 million in 2027 costs that plan officials had estimated Atrium's counter-program could create, WFAE reported.

Briner framed the flat pricing as a win. "Against a backdrop in healthcare that goes up 10 or 15 percent each year, holding flat is very good value," he told the trustees. He said the plan now has agreements in place with all four of the largest health systems in the state.

Steve Smoot is president of Atrium parent Advocate Health's North Carolina and Georgia division. In a joint statement, he said the deal was about "providing the peace of mind that comes from knowing the caregivers they trust will remain within reach."

Why members were watching

Atrium is the largest healthcare chain in North Carolina, with hospitals and doctors' offices in Charlotte, Winston-Salem and other parts of the state, WRAL reported. It is also merging with Raleigh-based WakeMed, a move that would push it into the Triangle and against UNC Health and Duke Health.

For weeks, members who see Atrium doctors or use Atrium hospitals faced the prospect of paying non-preferred or out-of-network rates next year. The agreement ends what WUNC described as weeks of uneasiness for tens of thousands of those members.

How the fight escalated

In July the plan chose Novant and UNC Health as preferred providers, agreeing lower rates in return for likely extra business. Days later it said Duke Health would enter the Access Tier for 2027.

The plan initially classified Atrium as a non-preferred provider, a tier where members pay significantly more than at preferred or access tier facilities. Atrium offered to match the preferred rates. Plan leaders called that a non-starter because it would undercut the Novant and UNC Health agreements. Atrium then announced a program to subsidise members' higher costs, and the plan sought a temporary restraining order in Wake Superior Court, a 148-page request, the Winston-Salem Journal reported.

A judge ruled in Atrium's favour at an initial hearing on that request, and Briner said the plan would take Atrium out of network. On 14 October the plan moved most Atrium facilities to its out-of-network tier.

The money behind the truce

The plan is facing a deficit of hundreds of millions of dollars. Briner's other measures to close it have included raising premiums on plan members, with higher premiums due in 2026, North Carolina Health News reported.

The tiered network was introduced this summer to address that gap. Preferred providers offer the plan lower rates in exchange for the likelihood that members will choose them for care. Tom Friedman, the plan's executive administrator, wrote that the approach was "solely to place the Plan on a better financial path" and to avoid "placing any additional burden on Plan members in the form of increased copays and premiums."

Over the last two years the General Assembly has appropriated about $4 billion to the State Health Plan. Briner called the Atrium proposal "a shell game" that shifts agreed-upon costs to the plan and ultimately to North Carolina taxpayers.

Ardis Watkins, executive director of the State Employees Association of North Carolina, thanked Briner and Atrium for the deal. She said his focus on long-term sustainability "reflects a commitment to responsible governance and to the many public servants and families who rely on the Plan."

What happens next

Atrium's Access Tier status begins in 2027, and the dozen Atrium children's and rural hospitals already in the tier stay there.

Open enrollment for plan members runs to 8 November, after the plan extended the window by nine days from 30 October because of confusion over Atrium's proposal, the Winston-Salem Journal reported.