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Reluctantly, county puts another $800k into health benefit plan

Mar 25, 2013 By Eric Blom, Staff Writer

Rising costs of claims to Fremont County's health insurance plan drove the county board to approve $800,000 more for the program next year. At its March 19 meeting, the Fremont County Commission was hesitant about the 15-percent raise from $5.2 to $6 million and wrestled with how to save money on the ballooning cost of the plan.

"I'm not going to oppose this increase, but I still feel as a commission that we need to have a better idea of the larger context, where we're going with our health care costs," Commissioner and liaison to the executive health committee Stephanie Kessler said.

Costs rising

Contributions to the county health benefit plan increased by 13 percent in 2009, 12 percent in 2010, 3.6 percent in 2011, and 15 percent in 2012. They are projected to raise 1 percent this fiscal year ending June 31.

"I think we need to revisit all the options and think outside the box because there are things we haven't thought of," Commissioner Keja Whiteman said.

The commission left open how the county and its employees will split new price tag for its health plan.

Workers currently pay 15 percent of the cost of their coverage, and Fremont County pays 85 percent. The county weed and pest district, solid waste district and library system also participate in the health benefit plan.

After employee contributions and those from special districts, the county general fund pays about half of the total cost of the health benefit plan.

"It's claims that are driving this, it's not administration or anything else," deputy county treasurer and executive health committee member Jim Massman said.

Increasing claims

Claims climbed about 21 percent in 2009, 16 percent in 2010, 12 percent in 2011, and 19 percent in 2012. They are projected to end this fiscal year 11 percent lower than last, then climb 8 percent again next fiscal year.

The programs looks to lose $245,000 this year, and raising contributions next year should start a reserve for the future .

In an interview, Massman said the cost of health care overall is on an upwards trend, and advances in medicine mean more services are being done than in the past, pushing up the cost of care even higher.

In an interview, Kessler said she does not expect the county can impact the larger trends, but commissioners is not sure the current plan is the best alternative.

"We really need to look at all the option and make sure we're pursuing the most cost effective option," she said.

Kessler said a health benefit plan is important to employees' families and benefits the county. When people consider job options, health benefits are increasingly important in their decision, and for the county to remain competitive in attracting employees, it has to offer an insurance plan.

"What we're doing is tinkering around the edges of our plan and not seeing a benefit," chairman Doug Thompson said at the meeting.

Hoping to incentivize using cheaper options, the county made a change in January so workers have a smaller co-pay for generic drugs compared to name brands.

The county plan now also has larger deductibles and maximum out-of-pocket expenses if for providers outside the health plan's preferred provider network. Those in the network discount their services.

A recent program hopes to encourage good health among workers by giving them $10-20 a month reduction on their contributions for meeting health guidelines,

They county health benefit plan also increased the maximum out-of-pocket expenses in a year for families the plan insures.

Thompson brought up replacing part or the whole benefit plan with an account the county would pay into that employees could use for health care or take with them.

"People get really creative when there's money involved," Thompson said.

"It's hard to change these claims, and that's what's getting us, so it's really an issue of cost shifting," Massman said. "If the county's going to save money, someone else is going to have to pay, and it's probably going to be the employees."

Self insurance

Rather than buy insurance, Fremont County is self insured.

Departments pay into an internal service fund for each employee in the health benefit plan according to the coverage they choose. Employees provide 15 percent of the total contribution, and the county covers 85 percent.

Then, when a covered worker receives medical services, the fund pays the bill. The county does have some insurance in case of very large medical bills.

The 15.16 raise applies to the total amount the internal service fund will receive. Because special districts also contribute and the share employees pay could change, the county might not see an increase to its budget proportional to the 15.16 percent overall raise.

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