Salary-Based Premium Information
Salary-Based Premium Information: Action Required
The State Health Plan (Plan) is facing a $507 million deficit which we are actively working to close. The Plan will be forced to make some hard decisions as we look ahead to 2026, which may include raising premiums for the first time in 7 years for our active, full-time permanent members. Implementing salary-based premiums allows us to minimize the impact on lower salaried employees.
The Plan’s Board of Trustees recently voted to approve the Plan’s ability to move forward with salary-based premiums. Implementing that strategy will require extra steps at the group and Plan level. As a reminder, premium rates have not been set and will not be available until later this summer. The Plan will continue to have rate sheets available to document the premiums due.
The board’s vote only approved the ability to implement this approach, not the number of salary bands or the premium amounts. This effort will require technical changes for groups that have payroll integration with the Plan. For groups without payroll integration, there will be additional manual work needed to ensure all employees have the correct salary information in eBenefits prior to the start of Open Enrollment as well as ongoing updates.
To ensure we are communicating requirements to the correct staff at each group, the Plan needs you to respond by April 1 with the contacts for this implementation.
Click the button below to complete this request for the information form so the Plan understands who the designated person within your group is responsible for implementing salary banded rates.
Click here to complete the request for information form
Click here to view HBR Alerts related to salary-based premiums.
In summary:
The State Health Plan has received a lot of questions about the February 27th HBR Alert on salary-based premiums. Below is some clarifying information as well as some FAQs to assist you with understanding this initiative.
- Approved: The Plan’s Board of Trustee’s (BOT) approved the ability to move forward with implementing salary based premium rates effective January 1, 2026, at the February 7, 2025, BOT Meeting.
- Salary Based Rates will apply to the employee only rate. The dependent rate structure (Employee/Spouse, Employee/Children, Employee/Family) will not change.
- Premium Rates will not be finalized until late summer.
- Salary Band assignment will be based on the employee’s total base pay.
- Groups must have the employees’ base salaries entered in eBenefits by September 1, 2025.
- Default Band: If a group does not load a salary for an employee, the employee will be defaulted to the second highest salary band.
The Plan has received several inquiries about implementing payroll integration with eBenefits. Groups interested in this option should review the Plan’s Rule on Employing Unit Payroll Integration for more information about that option. If it seems like a good fit, please email HBRInquiries@nctreasurer.com for more information.
That decision would need to be made in March to ensure it could be implemented in time for Open Enrollment. As a reminder, while this option removes much of the manual work associated with managing enrollment, it also requires more technical resources not only during implementation, but throughout the year.
Frequently Asked Questions
12-Month RIF subscribers’ rate will be based on their salary at the time of their termination.
Salary bands have not been finalized. The Plan will communicate those as soon as they are available. Make sure you stay up to date by signing up for the HBR Updates and Alerts and visiting the State Health Plan’s HBR page.
The intent is to lock the salary in for the entire plan year, unless the employee has a change to part-time status. Unfortunately, not all the codes will be in place at the time of go-live; therefore, during the first quarter of 2026, any change to salary that impacts the salary band, will impact the premium rate. More information about how to manage this change will be forthcoming.
Please review the Plan’s Rule on Employing Unit Payroll Integration. If your group meets the requirements to become a payroll group, please email HBRInquiries@nctreasurer.com with the number of employees and the technical resource(s) emails. If the Employing Unit meets the minimum requirements the Plan will contact the group for further discussions.
Yes. Make sure you stay up to date by signing up for the HBR Updates and Alerts and visiting the State Health Plan’s HBR page. There are plans to host several webinars. Stay tuned for more information.
The Plan's BOT approved discontinuing the $60 tobacco surcharge and the associated Premium Wellness Credit. At this time, there are no additional Premium Wellness Credits planned for 2026.
- There is no impact to employees that go on LOA when the employer is still paying the employer share of the premium. The employee will continue to pay the same premium they had while in a full-time employee status. The impact on employees who go on LOA that are fully responsible for the premium varies depending on how the groups manages premium collection.
- Employer Billed: While most groups utilize the Plan’s direct bill services for employees on LOA, others manage LOA premium collection on their own. For groups that manage LOA on their own, there will be no change to the premium rate invoiced to the group because the employee remains in an employee full-time status in eBenefits. Therefore, the Plan is not aware of the LOA, so the rate will not change.
- Plan Billed: There will just be one 100% rate for employees that are directly billed by the Plan for their premiums. Once the employment status is updated to LOA – Fully Paid, the LOA Fully Paid rate will be invoiced for the following month and continue until the employee is returned to a full-time employee status.