- [Kelly] Early polling of the 2026 US Senate races out and healthcare premiums from the State Health Plan to the Affordable Care Act are on the rise.

This is "State Lines."

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[bright triumphant music] ♪ [Kelly laughs] - Welcome back to "State Lines."

I'm Kelly McCullen.

Joining me today, political analyst, Joe Stewart, to my right.

To his right, Maggie Barlow of Maven Strategies with Carolina Journal's Donna King joining us in.

In seat four, Ryan Brown, the chair of the Libertarian Party of North Carolina.

A little spice to the discussion.

I've brought the third parties in.

I hope we can hang with that.

- Well done.

- Ryan, good to have you back as well.

- Thanks for having me back.

- Well, we got polling data to discuss.

So Donna, this came out of your team, Carolina Journal.

Harper Polling released the first poll, I think it's the first poll, of the 2026 US Senate race.

Very early, so we're gonna have fun with this one.

It features a near 4% margin of error.

They found 600 general election voters.

Polls showing former North Carolina Governor Roy Cooper with an eight percentage point lead over Republican Michael Whatley as of right now.

Someone else is the title is running at 3.9%.

The poll shows voters nearly evenly split on whether they support Republicans or Democrats on that congressional and state legislative generic ballot.

Donna, what do we take from this?

Fun polls always fun, very early.

- It is, and I think that's the important part.

That's what we take from this.

We still have 18 months more to go.

So this is a good baseline, which is what we were really hoping to get out of it.

One, I think the big thing it tells us is how close, how competitive, likely how expensive the Senate race is going to be, because we have an eight point spread.

We have the Republican candidate polling eight points behind with, you know, 51% name ID.

And the Democratic governor, the Democrats candidate with nearly universal name ID, 40 years in statewide elected office is only leading by eight points.

So this really tells us that this is going to come down.

People are voting party.

And as this grows over the next year, we're gonna start seeing what the influence of perhaps policy has on some of those numbers.

- How does your pollster find anyone who did not know who Roy Cooper is?

To your point, whether you agree or disagree with Mr. Cooper's policies, he's been out there and he's been a governor.

- He has.

- How do you not know the gov?

- Two terms as a governor.

He was attorney general for 16 years.

He's been in elected office for 40 years in North Carolina.

His name ID was nearly universal.

But what we did find was small things that you really gotta look into the weeds and look into those cross tabs.

People who were very supportive or very much opposed, that was near even.

So people are really going to be looking at what they've already decided about Roy Cooper and some of what happened during his tenure, and then they're gonna meet Michael Whatley.

- Have to meet Michael Whatley.

But we talk about Michael Whatley.

Maggie, if you're a Democratic consultant, hearing Donna, I can understand why Roy Cooper would be a great choice for the Democratic primary for US Senate.

I mean look at the resume.

And only 4% of the people have no idea who he is.

- Absolutely, Democrats are universally very excited about Roy Cooper for Senate this year.

I did think the one interesting thing in the poll was that, that this was the first time that Donald Trump was underwater.

And what we know about Whatley is that he is Trump's pick.

So I think that's also kind of an interesting thing to look further into and see how that's all gonna play out.

- Joe, is there a difference between Trump picking the GOP nominee for US Senate in North Carolina and North Carolina voters picking the candidate who Trump happens to support?

- Yeah, I think where the Republican Party is right now, it is hard to imagine.

Of course, anybody can file to run as the Republican Any registered Republican can file a run as a candidate for the US Senate in this election.

The fact that Donald Trump has made a selection and publicly endorsed a candidate probably precludes any other serious person from wanting to entertain it because Trump's sphere within the Republican Party is so strong at this point.

I think the interesting dynamic here is, as Donna alluded to, here you have Roy Cooper, 40 years of history, a long, long record of public service.

You have Michael Whatley, relatively unknown by the voters, no prior electoral office having been held.

As Oscar Wilde famously said, "The only thing worse than being in the newspaper is not being in the newspaper."

And so the thing we may find is voters may have a very specific feeling about the record of a candidate versus a candidate that seems like a clean slate.

The other dynamic that I think is interesting, because the two candidates are probably not gonna face a serious challenge in the primary, will the turn-out model in the primary be very muted as a result of this top of the ticket race not really being dynamic, not being a real choice for voters of either party?

Will other down-ballot races have unusual primary turn-outs because of such a slight turn-out of voters given the dynamic in the US Senate race?

- Ryan, 3.9% is "someone else."

"Someone else" does include Libertarians at this time.

I don't know if you have a Senate candidate in North Carolina lined up.

"Someone else" may also be Don Brown, who's running the upstart campaign, presumably from Western North Carolina.

That's where the campaign seems to suggest that he's out of.

What do you make of the "someone else" 4% turn right now?

- Well, again, it's a very far-out election, so polls tend to consolidate closer to election, but in the 2024 governor campaign, there was a 4.1%, I believe, or 5.1% who voted for a different candidate than the Republican or Democrat.

3.2 for the Libertarian.

We do have some candidates lined up.

They've expressed interest in wanting to run.

I do think, though, it'd be very interesting, because the grassroots support may not be there for Whatley since he was basically an establishment Republican, being chair of the RNC, but I do think it'll be interesting to see that.

2024 governor was a weird election in the end.

I think we could get the same situation with the 2026 Senate where a lot of people could vote for a third party, not being happy with the two mainstream candidates.

- Well, a lot of politics between now and 18 months from now.

Stay tuned.

We'll have more polls, and thanks for doing that on behalf of North Carolinians.

The State Health Plan Board and Treasurer Briner, Brad Briner, continue financial reforms of the State Health Plan.

The State Health Plan covers state workers, educators, and their families.

Facing a half billion dollar financial shortfall.

The recent state mini budget bill gave that plan a $100 million cash infusion for stability, Joe.

The health plan's rolling out a surgery service linking patients directly with surgeons to cut costs there.

Now, monthly premiums are officially on the rise on a tiered model.

The more a state worker makes, the more they're going to pay in premiums.

That will be the new way of the world for the State Health Plan.

What do you make of the policy?

You work in the industry of health insurance.

Where does it go from here?

The State Employees Association condemns anything that raises premiums without a matching pay raise at the least.

- Yeah, no, the previous treasurer, Dale Folwell, tried to hold the line on increasing the premium, the portion of the health insurance policy that state employees and retirees get through their service to the state.

He was able to hold, but he drained a lot of cash out of the reserve that the system has to be able to do that.

Part of the challenge is we're seeing pretty significant inflationary pressure within the healthcare industry.

The cost of medical treatments has gone up for a lot of reasons, and some of it is usual to the way that inflationary pressures impact any industry.

Some of it is North Carolina has a relatively expensive basis for providing healthcare to the citizens, not just the people that have insurance, but people that are uninsured as well.

And so that's created a lot of pressure.

The other part of this, the premium amount that will have to be paid in addition to what's paid now by these state employees, there's a $30 billion inadequacy in terms of the healthcare benefits that have been promised to retirees of the state of North Carolina.

When I worked in the state treasurer's office, for the first time, the accounting principles changed, and that unfunded liability had to be declared.

So the state's on the hook for medical benefits to retirees over the future equal to about one year of the state's operational budget, which is a huge number.

And so I think, to some extent, to try to make sure that the healthcare benefit that we offer public employees, we need to attract high quality and qualified candidates into these state positions.

The benefits that they get through the state health plan is an important pot.

I think Treasurer Briner has done a prudent thing here to try to figure out what is the right way.

They've tried to make it as fair as possible, make the increases tied to what the compensation of the employees are.

But there's still dark clouds on the horizon.

- Maggie, this is a political issue at its core.

The State Employees Association has shown some flex at the ballot box in the past.

There's also Medicaid sitting out there.

We'll talk about that a little bit later on.

If you're a progressive or a moderate candidate out there who wants to try to help state workers and help, you know, maybe folks on Medicaid, the working class, how do you balance this issue that there's a finite amount of resources right now and economic dark clouds out there?

- Well, I think it's something that the legislature is gonna have to really continue to invest in and invest to a much larger scale.

I mean, it's also impacting benefits.

I mean, the benefits are changing.

We're having all these issues getting DMV workers, getting people at DHHS, if you keep hurting the benefits, that's gonna have a long-term impact.

- Donna, you could make state jobs compete with the private marketplace, but at that point, does the state job with the lower salary, but stability, does it outweigh the market volatility of going private sector and maybe getting better pay and better benefits?

- I mean, I think this looks like a management problem across the board.

The state health plan has been in a deficit for eight years.

You know, the general assembly passed $150 million stopgap, is not gonna be a permanent solution, certainly.

But North Carolina has the most expensive healthcare in the nation.

And, you know, some of that really goes back to what we saw Dale Folwell fight, former Treasurer Folwell, fighting with the hospital association over pricing transparency.

You know, there are some fundamental holes in this system that have to be fixed through good policy, cooperation, and really getting us as a state, as a customer of the healthcare system, to know what we're paying for.

- Ryan, a libertarian position on giving benefits to public employees or private employees.

Where do you stand on this?

This is not one I see the libertarians engage in very much.

- Yeah, well, one of the thing is, if you are a state employee, your job is being paid entirely by tax money.

And that's okay, if it is what it is.

But when you see over the last seven years that healthcare costs have gone up, I think somewhere around 25% for the state plan, and the premiums haven't gone up a single dollar, the issue is that you're just asking other taxpayers of the state to pay more.

A lot of the healthcare issues, and we'll get to it later, like you said, are all intertwined, federal and state and local policy and all this.

But one thing we can do in North Carolina is to actually increase the supply, getting rid of our certificate of need.

And that would at least put some pressure, maybe downward, or at least take away some of that upward pressure if we can allow there to be more operators in the state.

- The state health plan issue and premium increases just one matter under discussion.

How about insurance rates under the Affordable Care Act?

Some of you call it Obamacare.

They could spike really soon, like by the end of the year.

Federal subsidies to lower monthly premiums will be ending, Maggie, and affected health insurance in our state of requesting price hikes to replace that lost cash, different health insurance or requesting differing price hikes could be 27% for one company, up to 36% for another.

Insurance Commissioner Mike Causey's team says the commissioner can review rate hike requests and reject unreasonable premium hikes.

But even they say it's been stable, there's inflation, we are filing more claims, and the state is growing.

Once again, a policy mess.

- That's right.

And this is a huge issue for North Carolina because I think about 1 million North Carolinians are on the marketplace.

And of those, you know, a lot of them... Having an increase of 25, 30%, that's gonna be a huge impact on your household budget.

The other thing is, I wonder how this is gonna impact our rural communities.

As you know, so many more people in the rural communities are on the health exchange and Medicaid.

So I think this is gonna have some long-term impacts on the way that our healthcare is delivered across North Carolina.

- Donna, take us through this plan.

Affordable care premium hikes go up.

We're looking at state Medicaid cuts potentially.

One Big Beautiful Bill does a lot of things to healthcare policy.

It's gonna fall on the state, it looks to me, and even to some senators and house members.

It's gonna fall on them to try to solve these complex issues.

- Sure.

Sure, I mean, this is a problem that actually goes back to COVID.

This is another example of a COVID era hangover.

During the COVID time, the American Rescue Plan lifted the cap on folks who could get premium tax credits to help pay for joining it.

Well, we went from 11 million people on this program to 24 million people on the program, on these things.

And so what we're happening now is it's due to expire in October.

And do we continue that emergency level commitment and financial commitment as a state?

Or are we financing?

We're putting into the deficit this dramatic increase.

They raised the cap on the percentage of income you could have.

Now up to 400% of your family income, people who make over the poverty level by 400% could buy into and get things on the exchange.

So now we have another COVID era program that we paid for with emergency money being asked to extend past October.

- Ryan, how tough is the COVID era hangover when federal money flowed through the Trump and Biden administrations and now we're dialing it back?

- Well, just the creation of new money that led to inflation in 2020 as a response to COVID was just obscene.

There was so much more money created just out of thin air that led to this part of the inflation.

That being said, once you get people hooked on subsidies of any kind, they're almost impossible to get them off these subsidies.

That's just politically unpopular.

So it's a problem of the politicians creating or creation, and they're gonna have to solve it.

And in reality, there needs to be probably a hard look at what we can actually afford.

But in reality we may just continue these subsidies as best we can.

- Joe, reading the plethora of media out there and a lot of good work on this topic, I have noticed one thing, whether the Republican or democratic voters out there, they seem to like the idea that if you are a working person trying to take care of a family, or just yourself and the dog at this point, if you're putting into the system and working that grind, it seems there's bipartisan support to do something to make healthcare affordable, if not free.

- Well, you know, it's interesting.

About 40% of Americans get their healthcare benefits through an employer, which is not the most efficient way to deliver that [chuckles].

It's just the way that's evolved in our economy.

But when you get your healthcare through an employer, you have someone else thinking that you should be healthy.

They want you to come to work, and they wanna make sure that the investment of the benefit of health insurance is maintained at a relatively affordable level.

So they want their workforce to be healthy.

So there's someone else, another, you know, person looking out for your ultimate health and wellbeing.

I think the concern is, and it certainly makes sense to say we want to tie a desire of getting a free health benefit to seeking gainful employment, or being employed, or actively seeking the kind of training, vocational or instructional training that would lead to full-time employment.

That's important too.

We don't want to create an economy where people are not incentivized to work.

We already have not fully returned to the participation in the workforce that we had at the rates before COVID.

But to Maggie's point, I think this is where the problem will manifest itself in North Carolina.

Some of the preliminary reports that I've seen with these increases in the exchange, up to 25% of the people in this state who are currently getting this as their health benefit, will probably find it unaffordable.

And the vast majority of those people live in the rural parts of North Carolina.

- Your group represents independent insurance agents out there.

You know, the customers are gonna blame their insurance agent for the rate hike, right?

I mean, I know how I treat my insurance agent.

I wanna blame him for everything.

It's not his fault.

But how will this affect the marketplace and affect an insurance agent trying to persuade someone?

Stay insured if you can.

- Yeah, no, it is very problematic.

And at the end of the day, for people that are getting their coverage through the exchange, if they're having to pay something out of their own pocket, it's a decision they have to make.

Can they afford groceries?

Can they pay their bills?

Can they do the things that are necessary to cover the other financial expenses of their company?

If they in fact come to believe that health insurance is something they can't afford, they will simply go without.

And then they will get their medical treatments in the emergency room.

They will become indigent in terms of the care that's provided.

And that necessitates an increase in the rate that everyone else pays that is insured, to cover those losses of the health providers.

It's not good for anyone, for anyone in our society not to have some sort of insured healthcare provider.

- Ah, the good old days.

North Carolina's high school students can no longer fail their grades solely because of excessive absences.

The new policy is rolling out for the '25-'26 school year.

So if a student's passing the course, they'll receive a passing grade, no matter what.

But students, you can lose school privileges for not attending class.

There's a group called My Future NC, does a lot of data analysis, reports that one fourth of our public school students missed over 10% of their total class days in 2024.

And that's a number that's been rising since before COVID, right?

Too late for me.

I can't skip class and get a good grade.

There was always that kid in school that could sleep through calculus, wake up, ace the test in 10 minutes, and walk out, never was harmed.

But this is chronic absenteeism, and most of us kids couldn't do that.

What's going on?

Why are we changing the state policy?

- Well, it's sort of a weird situation because if you can pass the class without showing up, we either have a bunch of gifted students, who should probably be in an advanced class, or the standards are so low, that you can sleep through class and pass, or they're not getting the instruction they need in the classroom.

They can get it either online via whatever program they're doing.

It's sort of a weird situation.

In the end, if you can pass the class, then if you have a passing grade, you should be able to pass the class.

But I think we need to look at the underlying issue of why people are not showing up and still able to pass the class.

- Donna, how in the world are absentee students growing in numbers after a pandemic, where we had to stay home and take school through Zoom?

- Sure, well, I mean this is more pandemic hangover, right?

You know, that's what they found is that chronic absenteeism is, has gone up.

It's almost doubled.

Not quite, but you know, like something from 10% to 16% since 2019.

But I think that is the core issue.

You know, if kids are able to not show up and still get a good grade in the class, what's going wrong?

And are they then also finding more education through other sources?

Are they at home doing classes?

Are they able to do dual enrollment programs through our fantastic community college system?

There are lots of options for kids to have that ability.

They should not be, you know, failed for a class for not showing up for these things.

Now, certainly you can take away things like, can you participate on a sports team?

Can you do some of the other extracurricular things?

But their academic grades shouldn't be penalized because they didn't find themselves in that classroom.

- If you're skipping school, you're not gonna wanna be a cheerleader or on the football or basketball team.

- Well you're not passing either.

I mean, you know, really that's what.

- That's the way it.

Maggie look at how our academic performance in the state's gonna dramatically improve overnight.

If every child who was poised to get the grade FF, which is where you get the absentee related failures, if it's just wiped off the books, this would help the statistics, wouldn't it?

- Well, I'm not as concerned about helping the statistics as that addressing the root problem.

And I think that we need to make sure that they're, we're providing our schools with the resources they need.

Because a lot of reasons for absenteeism is because lack of transportation, mental health issues that are keeping kids out of school.

We need to make sure that we're fully funding our public schools and that we're providing the resources that these kids need.

'Cause kids are gonna do best when they're in school, and in the classroom.

- Joe, the public school system, just, it will take as much state budget as it can be fed.

But to her point, are the schools systemically underfunded or underperforming, therefore creating victims of students?

Or do we have a parenting problem and a kid problem?

- Yes.

- [Kelly] Okay.

- I think the answer is that this is a complicated problem.

We've talked about public education issues on this show before, and I've always said, this is a system that's deeply rooted in the third century BC, where you build a facility and make young people come to learn.

But we probably need to systemically look at how we're providing educational instruction to young people and say, "Everything is on the table."

Let's come up with a strategy that makes sure young people in North Carolina getting the instruction they need to be successful in the 21st century economy.

How that is configured, I leave to much more learned minds on public education, and education issues generally, but it's probably time for us to stop saying, just because this is the way we've always done it, it's the way we should always do it, and come up with a strategy that makes sense in a modern context.

- You think some kids are adapting to the post-COVID era where they really are able to learn and become very intelligent students without sitting in that hard stool for eight hours a day?

- Well, I think, even from my own public education experience, just the availability of information through a variety of sources.

We used to rely heavily on the one kid in the neighborhood that had the World Book Encyclopedia.

And now my daughter went through school, which she had full access to the sum total of all human knowledge through the Internet.

It's a very different world in terms of where information can be found.

- Interesting point though, on these statistics, this is public school, not private school.

Do you see any kind of, do you think we could have different philosophies of education based on where your child attends, public versus private?

- I think so.

Most kids at private school want to be at private school.

And I think you could solve a lot of the education issues if you just ask the kids, "Do you even want to be here?"

And you put the kids who do want to be there in a situation where they can thrive.

Because a lot of the issues are not necessarily related to education or anything else, it's just a matter of kids not wanting to be there.

- All right.

Final topic tonight was more of a federal issue that's coming home to North Carolina, where our state leaders, Democrats and Republicans, are being forced to pay attention to the early and potential effects of the one Big Beautiful Bill in social services.

We've discussed this a little bit earlier in this show.

Governor Josh Stein is issuing a warning that the recently enacted state mini budget adjustment will not fund Medicaid enough to prevent cuts very soon.

There's $600 million in new state Medicaid funding coming in that law that still could be $319 million short of what's needed, Joe.

And then you got federal reductions coming to SNAP.

Also food stamps has advocates going public about those reductions.

Federal food subsidies were increased during COVID.

They're reverting back now to normal, I guess is a bad choice of words, but the state budget now could be on the hook for a portion of federal SNAP benefits.

Yet another social safety net handed down to our state.

And our state can't print money and go into deficit.

What do we do?

- Well, one of the big challenges here is that despite these particular issues, I think the nature of the relationship between the federal government and the states is changing forever, in some ways, not just in terms of healthcare, or nutritional assistance programs, but even in disaster recovery and response efforts.

We will probably not have what we had in the past in terms of the federal government participation, but the whole of all of the implications on the state from the federal legislation could be as much as $36 billion in terms of all of the programs that are in place now in North Carolina impacted through Medicare and Medicaid and the other things that were described in the federal legislation.

Yes, the legislature has a lot of work to do to try to figure this out.

They have a little bit of time because of the implementation dates of the federal legislation, but it's something that's gotta be solved because we all know that the people that were added to the Medicare roles as a result of expansion to have that benefit now and want that benefit going forward.

But we've gotta figure out a way to make that expense something that the state can figure out a way to pay.

- Put your political consultant hat on for that candidate, that Democratic candidate with all these issues just lay out seemingly perfect for 26.

How do you prioritize?

Now we have Snap, Medicaid, Affordable Care Act, and State Health Plan problems.

- Well, I think a lot of these candidates are gonna be able to go out there and talk about how these cuts are hitting their districts directly.

Again, cuts to Medicaid, a lot of those people that we were able to add on to Medicaid as a result of the passing of it, the expansion, you know, they're gonna be losing that.

And when their a voter going to the polls knowing that they lost their health insurance because of this elected official, that's gonna make a difference.

- Ryan, I wanna jump to you the final 60 seconds.

We'll finish with Donna.

From a libertarian perspective, if the debate is over people voting whether or not to keep expanded social safety net government programs running, where do the Libertarians fit in that discussion?

- Well, the libertarian belief is that it's not sustainable to just keep injecting money into this healthcare system.

We spent the entire show, or most of the show talking about three different government run healthcare programs and how they have issues.

And now we're asking voters that, "Hey, you might actually not be able to get all the benefits that you think you might deserve or you might have been promised."

And we're asking a lot of voters to make a lot of hard decisions.

- Donna, last 30 seconds to you to discuss this particular issue.

Once again, you brought it up.

It's the hangover.

- It's the hangover, right?

- [Kelly] The air's coming outta the balloon.

- It is the hangover.

We dramatically increase the money that went into Medicaid.

That is changing now.

Do we keep it going?

Certainly, it's going to be a very popular issue for Democrats, but at the end, we're borrowing that money.

This is increasing our deficit.

Being able to move forward and keep it on the books would be very, very challenging for this federal and the state government.

- That wraps up this show.

Thank you everyone for being on.

What a great conversation it was.

A lot about healthcare, kind of a rare show.

Email your thoughts and opinions at statelines@pbsnc.org.

I'll read every email.

I'm Kelly McClellan.

Thanks for watching.

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