Commission wrestles with employee insurance costs

By Charlene Sims, Journal staff

LCJeditor@icloud.com

MOUND CITY – The Linn County Commissioners made the decision to stay with Blue Cross Blue Shield (BCBS), the county’s current health insurance company, on Monday, June 15. The decision came after much discussion and a presentation from Jen Elliott, vice president of Employee Benefits at USI One Consulting on June 8.

In staying with BCBS, commissioners will be asking county employees to absorb a portion of the increase in cost.

County Clerk Chasity Ware, who had been working with Elliott on insurance costs, brought various insurance company options to the commissioners on June 8. Several options that were looked at included keeping the current BCBS policy with the current stop loss of $75,000 with a $379,000 increase or changing the stop loss to $100,000 and facing an increase of $188,000. Other companies considered were Allied, UMR (the third party administrator or TPA of UnitedHealthcare), and Luminare.

The way the stop loss works is that the county would pay up to, for example, $75,000 of an individual’s medical claim. If the costs went beyond that, the insurance would pick up the remaining costs.

Linn County is currently paying BCBS approximately $2.47 million but it will increase this year. To stay at the $75,000 stop loss, the county’s premium will increase 15.3% to $2.85 million.

If the county changes the stop loss to $100,000, the premium will increase 7.6% to $2.66 million. The Allied program for the $100,000 stop loss option would cost the county $2.5 million plus an amount to join the captive program.                                                                                   

Elliot explained to the commissioners that Linn County is responsible for all the claims up to $75,000 at which time the stop loss kicks in and starts paying any amount over the $75,000. Elliot recommended moving to $100,000 specific stop loss because the chances of people having claims between $75,000 and $100,000 is not a huge amount, but it would save the county in stop-loss insurance costs. It saves you in the premiums that you’re paying to stop loss.

Elliott told the commissioners that last year the county had eight people who went over $75,000 in claims. The sweet spot for an employer is two to three claims that large.

“It’s been looking like, for a couple of years at least, that you should move to $100,000, and we would highly recommend that,” Elliott said.

By going with Allied, the county would limit the county costs, but in the end the commissioners did not feel that they had enough information on that company to risk the employees’ health care with them. They seemed to have the same concern with the other two companies that were presented by Elliott .

At the previous week’s meeting Ware explained to the commissioners that she had asked Elliott to look at other companies that compared closely with what the employees were currently receiving from BCBS.

Commissioners learned about the different strategies offered by the other companies, including the Everlong Captive program, which is an arrangement that allows the county to form a cooperative with other self-funded employers to get a better deal on the stop loss.

In that scenario, the county does not share any of its claims with the other employers. The county’s claims would belong solely to the county, if other organizations had a bad year, it would not affect the county.

The county and other organizations are just going together as a cooperative group to purchase stop loss coverage, Elliott said. Employers pay collateral into that captive to provide a cushion of money, called a group captive, which allows a cushion after the stop loss that saves the employer money. Other programs utilized by the other companies include pharmacy assistance and bundling.

Ware reminded the commissioners that the BCBS program also includes dental insurance.

Much discussion was held last week with Commissioner Jason Hightower suggesting that Allied might be an option since it was supposed to be comparable and would keep the cost the same.

Ware told the commissioner, “(The employees) like what they have. They have been happy with what it has provided and covered for them. But ultimately you make that decision. I just want you to be aware of the options out there.”

Commissioner Jim Johnson said he thought that if the employees wanted to keep the same insurance that they might be willing to help absorb the increase in cost.

At last week’s meeting, County Counselor Jacklyn Paletta pointed out that last year some of the employees said was that they were not given the option to increase the employee contribution.

“So that’s another thing to consider,” she said. “You all could talk to the department heads about their individual departments and what their employees will in order to get that consideration.”

At present, the county pays $937.48 for an employee only, $1,832.13 for an employee and child, $1,941.71 for an employee and spouse, and $2, 836.37 for a family.

(Charlene Sims / Linn County Journal)

The final plan that the commissioners voted to go with is listed under the new amounts in the table above.

The employee incentive program, in brief, consists of a trifold that asks employees to do several things such as, get a physical or do biometric screening, eye exams, immunizations, and attend the county health fairs.  If they receive 10 points, that is their incentive to get a discount on their premium for insurance.