County healthcare costs on the rise

DOBSON — Monday night Assistant County Manager Betty Taylor explained that healthcare costs for county employees in the upcoming fiscal year will increase.

Commissioners chose to pass along some of the increased health insurance costs to employees while absorbing a portion in county finances.

Currently county employees pay a monthly premium of $182.94 for an individual employee who opts for a $500 deductible and $80.46 for a $1,000 deductible. The cost for family healthcare coverage is $1,010.80 and $726.24, respectively.

Taylor explained that insurance companies use claims data from past years to quote a price for coverage. Taylor said that a couple of exceptional claim years resulted in a lower insurance rate in the current fiscal year. Taylor described that phenomenon as “unheard of.”

Taylor went on to explain that the county had received quotes that resulted in no increased rate for claim adjudication. However, she and the county’s health insurance consultant told commissioners that the county and its employees would see about a 10- to 14-percent increase in the county’s stop loss coverage.

Surry County is self-insured, meaning that the healthcare claims of employees who are on the insurance plan are paid directly from county funds, after being adjudicated by a third-party. However, the county’s stop loss insurance protects the county against claims that could have drastic negative effects on county finances or even bankrupt the entity.

The county’s stop loss insurance sets a threshold of $75,000 per claim. A claim that exceeds that amount is paid by the stop loss insurer, which is HDC Life. Likewise, if the county’s aggregate healthcare claim costs reach $4 million the stop loss insurer would pay any additional claims.

Taylor recommended the county change its stop loss carrier to Optum Health, the carrier that offered the lowest quote. However, the change still resulted in increased healthcare expenses for the upcoming fiscal year, which will be shouldered by both the county and its employees.

According to Taylor the increase isn’t out of the norm. She said in her 25 years with the county she has seen increases of 30 percent or more. Taylor said that, with inflation and rising healthcare costs, the price of insurance is normally a number that increases from year to year.

This year’s increase will result in a single county employee’s monthly premium increasing to $190.26 for a $500 deductible and $83.68 for a $1000 deductible. Employees with families on the plan will see their premiums increase to $1,061.34 and $762.55, respectively.

Additionally, the county is absorbing some of the increased costs, raising its healthcare coverage match by 4 to 5 percent.

In addition to changing stop loss carriers, Taylor said the county is eyeing a move to a different pharmacy benefit manager (PBM). Taylor told commissioners that Express Scripts, the county’s current PBM, does not have Walgreen’s Pharmacy in its network of providers.

Taylor told commissioners that the county’s PBM could be changed at anytime. She added that she would like to see Walgreen’s in the network for county employees.

However, Taylor also said that the PBM move must be well thought out. Taylor told commissioners that she must research alternative PBMs to ensure their plans cover the same drugs, and that a move wouldn’t inconvenience employees who have grown used to the current pharmacy plan.

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