Duke Health will be the N.C. State Health Plan's access-tier provider in the Triangle, meaning care at its facilities will be available next year at largely the same prices as they were this year.
The knock-on effect of that is that WakeMed will move into the plan's nonpreferred tier, meaning services at its three hospitals and assorted clinics will become more expensive for State Health Plan members who choose to continue receiving care there.
"We are open to folks competing for our business. They (Duke) chose to compete really hard for it. That's how capitalism works," N.C. State Health Plan Executive Administrator Tom Friedman told reporters.
The State Health Plan approved a plan last week that introduces tiered benefits in an effort to save both the plan and its members money by receiving discounted rates for care from some health systems in return for the promise of increased volume.
Duke Health officials reached out to the State Health Plan in recent days with a proposal that offers significant discount off members' current rates for service with them. That caught the attention of Friedman and other health plan leaders and caused a deal to quickly come together.
"Duke’s outreach and bold plan caught the Plan by surprise given the previous CEO’s very public push for rate increases for (State Health Plan) members but we believe it is a clear demonstration that competition brings out the best of us and when we align our interests we get the best deal for all stakeholders," Friedman wrote in a statement Wednesday.
State Health Plan members used Duke Health's services more than 253,000 times in 2025, according to Duke's press release announcing the agreement.
“Serving State Health Plan members is both a privilege and a responsibility for Duke Health. Our priority is making sure State Health Plan members and their families can continue turning to Duke Health," Dr. David Zaas, chief executive officer of Duke Health, wrote in a statement.
As part of the tiered arrangement, health plan leaders were always clear that some health systems were going to be more expensive for members, an effort to steer members away from seeking care there. That is now the situation WakeMed — and Atrium, the health system it is seeking to join — finds itself in.
Friedman called WakeMed "an excellent facility" and praised both its OB-GYN care and its emergency room. But, Friedman wrote, the discounts Duke was offering in addition to its quality of care were too promising to pass up.
There are some exceptions to WakeMed's non-preferred status, including its individual primary care providers who are in the State Health Plan's preferred tier. And as with all emergency services, WakeMed's emergency rooms will be defined as access-tier providers.
A WakeMed spokeswoman did not immediately respond to a request for comment.
New benefit structure for State Health Plan
Last week, the State Health Plan's Board of Trustees approved a tiered benefit structure beginning in 2027. The plan is for what are being called preferred providers to offer care at discounted rates in return for seeing significant increases in volume from the State Health Plan's roughly 550,000 active members.
State Treasurer Brad Briner, a Republican, said last week that health plan officials estimate that between the new benefit structure and changing the plan's third party administrator back to Blue Cross NC, they could save more than $1 billion in the coming years.
That's a potentially huge boost to a plan that has been moving quickly in recent years to address a deficit after years of spending its reserves to hold premiums steady. And it's a potential boost to state government, which has seen its contributions to the plan tick up steadily, reaching nearly $4 billion in the budget that became law earlier this month.
Members on the Standard PPO plan who seek healthcare at Iredell Health, Novant Health or UNC Health will have $1,500 deductibles and $4,000 out of pocket maximums for individual coverage. They will also pay lower prices for services like specialist visits, imaging or inpatient hospital stays.
By comparison, a member with the Standard PPO plan seeking care at an access tier facility like Duke Health will have a $3,000 deductible and $6,500 out of pocket maximum.
"The word 'preferred' means something. We prefer you to go there. We are making it very, very affordable to go there. So while everyone wants to win and no one likes to lose, unfortunately there are going to be winners and losers. And that is based on price, that is based on member disruption, that is based on quality," Friedman said.
Significant increases in spending start to kick in at the nonpreferred tier, or providers who are still in-network but who have not negotiated lower rates with the health plan. Those include Atrium Health, Granville Health, some Duke LifePoint facilities and now most WakeMed facilities.
Members with the standard plan seeking care at nonpreferred providers will see $5,000 deductibles and have $12,000 out-of-pocket maximums.
One notable exception to the tiered benefits is emergency room care, which is a $600 copay with members paying 30% after meeting their deductible.
Friedman has also been clear that they will continue providing 2026-level rates to members who are receiving care from now nonpreferred providers for cancer, maternal health. neonatal intensive care or a transplant.
"We will try to be as fair and equitable as we can. So we're not putting an end date on it right now," Friedman told reporters last week.
