“We think that (15 percent increase) would properly fund the plan, at least right the ship, in terms of costs,” said Eric Deeg, a county-hired consultant from Western State Insurance Agency at the commission's Nov. 2 meeting. On a …
Implementing health savings accounts With funds again running short, the Park County Commission plans to put an additional $145,000 or so into the county's health insurance plan this fiscal year.Effective Jan. 1, the county will begin paying $201,448 per month into its self-insured plan — a 15 percent increase from the $177,274 it had been paying for monthly employee premiums.
“We think that (15 percent increase) would properly fund the plan, at least right the ship, in terms of costs,” said Eric Deeg, a county-hired consultant from Western State Insurance Agency at the commission's Nov. 2 meeting. On a unanimous vote, the commission adopted the recommendation.
The county had increased funding by 10 percent in July to meet rising health insurance claims and costs. At that time, Deeg and the county employees' insurance committee had recommended a 25 percent increase. But commissioners did not want to over-allocate money to the insurance pool, and they promised to watch the plan carefully.
“I understand budget constraints. It was worth the chance to take, to look at the 10 percent increase in funding,” Deeg said. But he said it wasn't enough.
Between the beginning of the fiscal year in July and the end of September, the plan ran a nearly $90,000 deficit paying for funding and medical claims for the more than 200 employees and families covered by the plan.
At the Nov. 2 meeting, Commission Chairman Jill Shockley Siggins recommended the county draw from its general reserves and raise its monthly funding to $265,284 — a roughly 55 percent increase instead of a 15 percent hike. That increase would be enough to cover the worst-case possible scenario, known as the county's aggregate liability.
“I think it would make our employees feel that we're trying to fully fund our healthcare,” said Siggins.
Commissioner Dave Burke agreed with Siggins, saying improving the health and job performance of the county's employees was the goal.
He noted that if the funding turned out to be unneeded, the only difference would be that the excess funds would be in an insurance reserve rather than the county's general reserve.
However, commissioners Bucky Hall, Bill Brewer and Tim French opted for the 15 percent hike, and Burke joined them for a 4-0 vote.
In addition to increasing funding, the county made several changes aimed at changing its plan to a more “consumer-driven” plan.
The county raised its deductible to $3,000 for individual employees, and $6,000 for families — up from $2,500/$5,000.
After reaching the deductible, the county will split costs 50-50 (down from 80-20) until the employee hits the annual out-of-pocket maximum of $5,000 for singles, $10,000 for families.
The plan changes also focus on employees receiving generic prescription drugs whenever possible.
With the roughly $109,000 worth of savings from those changes, the county plans to offer confidential, voluntary health assessments and blood screenings to its employees and spouses. That data, Deeg said, can catch diseases and ailments before they become severe and provide county officials with information about the health of its employees — as a group.
“Nobody on the Board of County Commissioners, the insurance committee or myself will know the results of these (individual) health assessments,” said Deeg.
The rest of the savings — up to $80,000 — will be used to fund health savings accounts for the county's more than 200 employees and 110 spouses.
Employees and spouses will receive $125 each in a health savings account if they choose to receive one of the screenings and another $125 if they do both.
The money in those accounts can be used at the employee's discretion on many health-related expenses, before the deductible is reached.
When employees have control of their own accounts and money, “people become shoppers,” Deeg said, and they find better prices. He said that may mean looking outside Powell and Cody for medical services.
Overall, Deeg said consumer-driven plans like the county's — with higher deductibles and health savings accounts — tend to see annual cost increases of between 6 and 8 percent. That's about half the annual increase seen in standard plans, Deeg said.
“This is going to be a culture change for some employees, no doubt about it,” said Burke of the changes to the plan. “Personally I think that it's a good change.”
He added that it was important employees understand the changes.
The county's insurance plan all but ran out of money last winter, spurring commissioners to make significant cuts to insurance benefits in March — raising deductibles and all but eliminating a benefit that allowed most doctor's office visits to be covered with a $35 co-pay.
Deeg said those changes had reduced costs “a little bit,” perhaps 2 to 3 percent. He noted that such changes don't affect the habits of those with the severe ailments that tend to be expensive.