As Butler County employees’ health insurance claims continue to mount, officials are bracing for a 10 percent hike next year.
The net claims paid per employee per month in 2016 was $825, it jumped 29.1 percent last year to $1,021. So far in 2018 the weekly average of claims paid is $321,935 and all tolled — through May 20 — the county has paid out almost $6.5 million, against a budget of $17.6 million. The highest weekly claim total reached almost $500,000 but the claims have dropped a bit in recent weeks.
Butler County Administrator Charlie Young said they have taken to monitoring claims activity weekly.
“We are working closely with our consultant to dig deep into the 2017 data and we have been receiving weekly aggregate claims data reports throughout 2018,” Young said. “We are developing cost containment strategies with the intent to lower our overall costs.”
Human Resources Director Laurie Murphy said they are doing more than ever to get employees engaged in cost containment, like making sure they know about resources like urgent care information and the “Tell A Doc” feature to get a consult with a doctor over the phone, as opposed to visiting the emergency room.
By collecting the weekly data she said they can get the word out to the rank and file they are seeing claims increases in certain areas and offer better options.
“We’re trying to target our communications to the employees and our wellness committee and engage them because we’re all in this together,” Murphy said. “We all own this. Where we can bend the curve is we need to get the message to the employees.”
And if that isn’t enough, Commissioner Don Dixon said when it comes time for the commissioners to decide how much of the increase the general fund will bear for next year — later this year during budget time — they approach it as the employment benefit it is. In other words, healthy raises or not.
This year the county picked up around $14 million of the health insurance costs and employees were budgeted to cover about $3.6 million. In years past when the county was hit with huge increases the commissioners have at times shouldered the bulk of the cost increases.
Dixon said they will have to look at what the employment market is doing in this volatile health care environment and make decisions accordingly.
“If health care goes completely out of control then we’ve got to reach into the general fund and compensate for it and there’s less money somewhere else,” Dixon said. “Less money for pay for performance, so we’re going to do what we typically do and manage it the best we can.”
Last year the county went to a self-insurance model after several years of double-digit increases for insurance coverage. The prime-movers behind the rate hikes were some large once-in-a-lifetime claims over several years. They had a single $5 million claim in 2013 and a $3 million month in November of 2014.
Under the self-insured plan the county pays an administrative fee and the claims themselves. There is a stop-gap feature so if claims top the $175,000 mark the insurance carrier picks up the costs for anything over that amount.
Last year the county had 19 claims top the stop-gap level compared to only two in 2016.
Through the years commissioners have also tried to get spouses get off the county’s policy to cut costs. Spouses remain the most expensive category, costing $8,949 per member per year last year compared to $7,016 for employees and $3,131 for dependents. Those figures again were considerably higher than 2016 when the costs were $6,745 for spouses, $5,081 per employee and $2,637 for dependents.
Murphy said it has been a historical, national trend, not just a Butler County problem. And it’s hard to pinpoint why.
“It’s hard to tell, I don’t know it’s in part because of our aging population, it’s in part because of the economy, depending upon maybe spouses being disabled and not having access to other insurance so they are on the county’s plan,” Murphy said. “It might be the county’s plan is richer and cheaper than the spouse’s plan. There are so many factors that go into it.”
The county formed a wellness program a number of years ago and last year 823 of about 1,350 insured employees were participants. Young said the program is an important piece of the health insurance puzzle.
“The committee is committed to educating employees on the importance of changing behaviors which are detrimental to overall health and well-being,” Young said. “We are sharing information on being good consumers, disease management, tobacco cessation, reducing pharmacy costs and developing new and inventive wellness incentives.”
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