Clark County will change its health care insurance provider to avoid a nearly $1.4 million increase next year, which should also lead to a smaller rate increase for about 750 county employees.
The county will instead move to a self-funded insurance model, which could save the county about $1.2 million next year. It could cost up to $15.5 million with a maximum number of claims.
Clark County commissioners unanimously agreed to move forward with the plan this week.
The new model may increase employees’ rates by about 2 percent; however, a renewal of the current insurance plan likely would’ve increased those rates by 12 percent, according to county estimates.
The rates for next year’s plans will be determined before the end of the year.
All risk for claims will now fall on the county as part of a self-funding model, Clark County Administrator Jennifer Hutchinson said.
“If you have a great year, the county benefits,” Hutchinson said. “If you have a bad year, the county takes that risk.”
Last year, the county paid about $12.4 million for its insurance plan through the County Employee Benefits Consortium of Ohio, the health-care division of the County Commissioners Association of Ohio. The county currently pays a monthly premium to to the consortium to cover claims and administration costs.
The consortium, however, was offering rates next year with increases anywhere from 3.4 to 11.9 percent, or up to $1.47 million — which county leaders said they can’t afford moving forward.
“(The increase) is a concern and it’s not possible under our current budget going into 2017,” Hutchinson said.
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The deadline to participate in consortium’s plan was Friday, commissioners said.
“We can’t continue with our current plan,” Hutchinson said. “It’s a very rich plan. The price increases each year, it just gets more substantial.”
It’s unknown right now if any of the details of the coverage, such as deductibles or co-pays, could change.
Several counties throughout the state use a self-insurance model, Clark County Commissioner John Detrick said, while more than 30 participate in the consortium.
“There’s no free lunch, so there is risk,” Clark County Commissioner Rick Lohnes said. “There are other things we can do to manage that risk by paying more out of our pocket in a self-funded plan.”
The county is faced with losing up to $3.1 million annually in 2018 due to changes to federal sales tax laws regarding certain health care organizations.
“So far, we’ve seen nothing or heard nothing of relief,” Lohnes said.
A third-party administrator will be hired to process claims.
Union leaders were made aware of the possible change, AFSCME Local 1939 President Jennifer Young said. The union declined to comment on the change until final numbers were available, Young said. AFSCME is the county’s largest union with more than 160 members.
The current insurance plan costs single employees about $63 per month, while married employees pay $126 and families pay $186.
The monthly rates for the new insurance model have yet to be determined, but could increase by about 2 percent, according to county estimates.
Employees will still be able to participate in the county’s wellness plan, which can also reduce the cost of the monthly premiums.
The new plan could also include an option for a health savings accounts, Hutchinson said.
Detrick endorsed the move to a self-funded plan.
“Politically, it’s the right thing to do and financially it appears to be the right thing to do and the administration is working for it,” he said.
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