After three months of public disagreement, Atrium Health and the State Health Plan have struck an agreement that lets state workers, retirees and their families continue seeing Atrium doctors in 2027 at roughly the same out-of-pocket expenses they currently pay, according to a report published Oct. 27 by North Carolina Health News and The Charlotte Ledger. The resolution came after State Treasurer Brad Briner moved most Atrium providers out of network on Oct. 14, a step that apparently brought the hospital system back to negotiations with lower rates. Under the deal, Atrium will sit in the middle tier of the State Health Plan's new three-tier network, meaning patients using Atrium doctors will face about the same costs next year as they do now.
The standoff began in July when Briner introduced the tiered network following a yearlong bidding process that placed Atrium in the most expensive, non-preferred category. A round of talks in September moved some Atrium rural hospitals and children's facilities to the middle tier, but most doctors and hospitals stayed in the costliest bracket. On Oct. 6, Atrium announced an "affordability protection program" to cut out-of-pocket expenses for state workers, but the State Health Plan would still pay Atrium's higher rates—a move Briner said would bankrupt the plan. He tried to block the program in court on Oct. 9, but a judge rejected his request. Five days later, Briner announced most Atrium providers would become out of network entirely, and within days Atrium returned with discounts that State Health Plan Executive Administrator Thomas Friedman called "materially better" than earlier offers.
The uncertainty left thousands of state workers unclear about whether they could afford to keep their Atrium doctors, particularly difficult in the Charlotte area where Atrium is the dominant provider. The American Federation of Professional Educators in North Carolina sent a letter to Briner and Advocate Health CEO Gene Woods calling the confusion "unacceptable" and urging both sides to negotiate. "No public servant should be placed in a position where making an informed healthcare decision becomes a financial gamble," the letter stated. Briner acknowledged the process was confusing and said much of it "happened in the public domain in a way that I wish would have been privately, so that we didn't worry our members so much." The plan's open enrollment period runs through Nov. 6.
The State Health Plan, with roughly 750,000 members, has leverage that most employer groups lack when facing consolidated hospital systems and insurers, according to the report. Former Treasurer Dale Folwell tried unsuccessfully to force all state hospitals to accept lower payments tied to Medicare rates, building a reputation for confronting hospitals he called "cartels." When Briner took over in 2025, the plan was facing a $507 million deficit projected to grow to $1.3 billion by 2027 without changes. Asked what made his approach different from Folwell's, Briner said, "Divide and conquer. You can't take them all on at once." Friedman said the plan also has "soft power" because hospital systems view serving state employees as "a badge of honor." The three-year contracts sorting hospitals into tiers, with optional one-year extensions for two more years, are designed to generate savings that Briner hopes to invest in keeping people healthy upfront—an approach that makes sense for the State Health Plan because workers tend to stay in their jobs longer than most Americans, who change employment an average of almost 13 times before retirement.