On a recent episode of Carolina Newsmakers, Dale Folwell, the 28th North Carolina State Treasurer, discussed the current state of various state programs, his thoughts on the future, and his upcoming retirement. With a career spanning multiple terms, Folwell’s tenure has been marked by a dedication to transparency, fiscal responsibility, and public service.
Transition Plan as Folwell Retires
As Folwell prepares to step down from his role as Treasurer, he reflected on his efforts to ensure a smooth transition for his successor. The term ends on December 31st, 2024, and Folwell has begun inviting both candidates for Treasurer to sit in on key meetings for various commissions and boards under his purview. This allows the future Treasurer to gain insights into the operations of the office before officially assuming the role.
This approach, inspired by former Treasurer Harlan Bowles, is driven by a desire to ensure that state finances remain stable and that the new Treasurer is fully prepared to take over smoothly.
Transition from Blue Cross Blue Shield to Aetna for State Health Plan
One of the key topics discussed was the recent transition of the State Health Plan administration from Blue Cross Blue Shield to Aetna. This marks a significant change after nearly 50 years with Blue Cross. Folwell likened this switch to changing the “transmission” of the health plan, emphasizing that while certain aspects of the plan’s structure—like premiums and deductibles—would remain unchanged, the claims administration and network would now be handled by Aetna.
This decision was driven by Aetna’s higher score during the contract bidding process and is expected to save the state around $140 million. Folwell also assured listeners that this move is part of a broader trend, as other major entities like the League of Municipalities and Truist have also transitioned from Blue Cross to Aetna.
Addressing the Rising Costs of Healthcare
Healthcare costs have been a growing concern for many, and Folwell didn’t shy away from addressing the issue head-on. He pointed out that North Carolina ranks as the most expensive state for healthcare in the U.S., a status that has largely been driven by rising hospital and prescription drug costs. Folwell has been vocal in his critique of what he calls the healthcare “cartel,” which, in his view, places profits over patients.
An example he gave highlighted the disparity in drug pricing. He described a scenario where a weight-loss drug cost $1,300 in the U.S. but only $100 in other countries like England. His mission has been to push for greater transparency in healthcare pricing, so that North Carolinians can better understand the value of their healthcare services.
Highway Trust Fund and the State Pension Plan
In addition to healthcare, Folwell discussed two other major areas of state finance: the Highway Trust Fund and the State Pension Plan. Regarding the Highway Trust Fund, Folwell expressed concern over the Department of Transportation’s (DOT) financial management, noting that the department had overspent by $2 billion at one point. He emphasized the importance of making sure the gas tax revenue is spent efficiently on transportation projects that actually benefit the state’s infrastructure.
On a more positive note, the State Pension Plan under Folwell’s management is in a strong financial position, with $126 billion in assets, making it one of the largest public pension plans in the world. Folwell proudly shared that the pension fund is 89% funded and that it remains one of the most efficient in the U.S. He credited the dedicated team at the Treasurer’s office for ensuring that the state remains in the “check delivery business,” paying out $7 billion in benefits annually to state employees.
Concerns About the Federal Government’s Fiscal Future
While Folwell is confident about North Carolina’s fiscal health, he is less optimistic about the federal government. He expressed concern over the federal government’s mounting debt, stating that both political parties have been responsible for driving the country toward an unsustainable fiscal future. For the first time in U.S. history, the government is expected to spend more on interest on its debt than on national defense, a fact that Folwell believes underscores the seriousness of the problem.
He drew parallels between the federal government’s situation and the state’s pension system, both of which rely on fewer workers paying into the system compared to retirees drawing benefits. However, unlike Social Security, Folwell believes North Carolina’s pension system is on more solid ground, thanks to years of conservative fiscal management.
Focus on Fraud Prevention
In his remaining months as Treasurer, Folwell will continue to focus on fraud prevention, particularly within the pension and health plans. He explained how cybersecurity and fraud detection have become increasingly important due to the sheer size of the funds under his management—over $260 billion.
Folwell emphasized that fraud prevention is challenging because it often involves preventing problems before they occur, which can be difficult to quantify or celebrate publicly. Nonetheless, he highlighted the importance of maintaining vigilance in ensuring that public money is spent responsibly and protected from cyberattacks.
Looking to the Future
As he looks forward to his retirement, Folwell remains committed to finishing his term with the same dedication he has brought throughout his tenure. He aims to maintain the Treasurer’s office’s reputation for efficiency and transparency and continues to focus on serving the people of North Carolina.
While he did not reveal specific details about his future plans, Folwell indicated that he would remain active in public service, hinting at a potential future in leadership outside of government.
