RALEIGH - The state health plan for teachers and state employees lacks adequate and effective leadership, according to an audit released this morning recommending that the General Assembly place the plan under an executive branch agency's authority.

In 35 other states, the report from state Auditor Leslie Merritt's office notes, the state health plan is run by an executive branch agency, which helps to prevent potential conflicts of interest among health-care providers and legislators. Merritt's report declares that allowing a state legislative committee to oversee the plan creates the opportunity for undue political influence in the plan's administrative decisions and contract negotations.

"There is clearly a problem when the Health Plan is running a deficit and facing tough economic times ahead. North Carolina's teachers and State employees need to know that the Health Plan that they're paying for is being properly managed and will be there when they need it," Merritt said in a news release.

The state auditor's office is also preparing a second audit of the health plan examining the financial causes leading to its deficit.

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