The county went to a self-insurance model in 2017 after several years of double-digit percentage increases for insurance coverage. Some large, unusual claims over several years drove those increases, including a single $5 million claim in 2013 and a $3 million claims month in November 2014.
The commissioners at the time said they wanted more control over their costs but Commissioner Don Dixon told the Journal-News the cost difference between self-insurance and traditional coverage for next year was negligible when figuring in reduced risk.
“I think in light of all the issues we’re dealing with with COVID and the testing and what effects are left after you do have COVID in the long run,” he said. “I think it’s a very prudent move to financially lock down our rates going through these times.”
The commissioners will absorb the cost increase and not pass it on to the employees.
Under the self-insured plan, the county paid an administrative fee and the claims itself out of county coffers. There was a single claim limit of $175,000 and a total limit of $20.8 million, so any bills over those amounts were paid by United Healthcare.
The total claims last year were $16.5 million and the commissioners had budgeted $20 million. County Administrator Judi Boyko told the Journal-News as of Sept. 14 the county has had almost $12 million in claims, about $1 million more than a year ago.
Human Resources Director Laurie Murphy said since July 2018 the county has has 35 claims between $175,000 and $250,000 and 25 claims in the $250,000 to $500,000 range.
The coronavirus pandemic has made projecting costs tricky. Early on in the crisis elective medical treatments were cancelled and most doctor’s visits were virtual, but the county’s costs were still relatively high.
Now that things are opening up again Murphy has said predicting claims experience in this COVID world under self-insurance is difficult.
“So it’s so hard to project what’s going to happen the rest of this year," Murphy said. "We don’t want to be too conservative but we don’t want to be unthoughtful and things could blow up.”
Commissioner T.C. Rogers said this move was to “provide some stability.” Plus he said had they continued with the self insurance model, they would have had to increase human resources staff to handle the work.
“It was a matter of the differences between being self insured as far as a new contract were close enough that we thought that we should go with a guarantee rate," Rogers said. “In light of we’re just now going to start our budget hearing and the theme of that is we are in a good place financially but there are a lot of variables, especially the first two quarters of next year.”
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