BUCKHANNON – Upshur County Commissioners on Thursday discussed changes to the county employee health insurance plan after learning their current method of funding employee health insurance – self-insurance – is no longer sustainable.
County administrator Carrie Wallace told commissioners they’d spent more than $1.6 million on employee health insurance in fiscal year 2018-2019 and had already spent close to $900,000 on insurance in the first five months of the 2019-2020 fiscal year alone.
Fiscal years begin July 1 and end June 30 of the following year.
“So far, for the five months of this fiscal year, your health insurance has cost just below $900,000,” Wallace said. “Last year, it was upwards of $1.6 million. You can no longer afford to fund your self-insurance. You have been approached by a broker by the name of Pete Thackston with USI who has made a recommendation to switch over to PEIA (Public Employees Insurance Agency). There are two different PEIA plans, a state plan and a non-state plan.”
Wallace said the county plan would be considered a non-state plan, so if they make the transition, county officials would have control over how much employees contribute to their plans.
“He is highly suggesting Plan C, which, in his calculations, would be an expense [for the county] of about $800,000 per year,” Wallace said.
She said Plan C would result in employees having the same deductibles they currently have of $500 and $1,000 if they fund the Health Reimbursement Account or the Health Savings Account in the amount of $2,000 and $4,000.
“That’s similar to what you currently do with your self-insurance,” Wallace said. “By funding the HRA portion, it would keep the deductibles at $500 and $1,000.”
A deductible is the amount an individual or entity must pay before insurance kicks in to cover the cost of health claims.
She said the proposal also keeps the employee contributions per month for Plan C the same as what employees are currently paying at $20 for a single employee; $30 for an employee and children; and $40 with employee and spouse.
“Now, with PEIA, there are only three tiers, and we currently have four,” Wallace said. “We [currently] have single employee, employee plus children, employee plus spouse and family, so his recommendation would be to take family down to the same rate as employee and spouse of $40, which would actually be a decrease for employee contributions per month by $10 for family plans.”
Wallace said she has arranged for Thackston to attend the commission meeting Jan. 9, 2020 at 1 p.m. to present his proposal to the commission. He’ll also explain the proposal at the supervisor policy board meeting on Jan. 19, 2020.
“Our plan would be, like I said, to have him back at the supervisor policy board meeting on the 19th and then to schedule preliminary employee meetings the last week of January so employees can bring as an example their prescription list and talk to them about what would be best for them and what their coverage will be,” Wallace said. “They’ll be able to gather any documents necessary prior to open enrollment, which looks like it would take place at the end of March or beginning of April.”
In a self-insurance plan, which is what the county currently has, an employer assumes the financial risk for providing healthcare benefits to employees, according to the Self-Insurance Institute of America, Inc.
“In practical terms, self-insured employers pay for each out-of-pocket claim as they are incurred instead of paying a fixed premium to an insurance carrier, which is known as a fully-insured plan,” according to the website.