By Dan Hust
MONTICELLO — A majority of the County Legislature agreed on Thursday to institute a new self-funded health insurance plan for county government workers.
Seven of the nine legislators felt the anticipated savings – now pegged at $1.2 million instead of $1.7 million – were worth pursuing. (Legislator Frank Armstrong was absent.)
“This new program will offer cost savings to the county, comparable care to what employees and retirees are receiving now, and an innovative healthier-workforce program to offer our employees and retirees," said Legislator Alan Sorensen, who first championed the idea.
“This change,” he added, “will permit the county to reduce the cost of health care by $1.2 million in health insurance expenses in 2012. These cost savings will also help to reduce the burden of employee health benefits on taxpayers and is one step the county has taken to get our fiscal house in order.”
But Legislator David Sager disagreed, having previously expressed concerns about GHI, the network the county’s plan administrator, EBS-RMSCO, will utilize to provide healthcare services.
In particular, he shared worries about the poor reimbursement rates to physicians and other providers, which could lead them to not participate in the county’s new plan.
He also read a letter written by County Treasurer Ira Cohen calling the expectation of savings “a passing fantasy.”
Specifically, Cohen felt the county might not have enough cash on hand to pay claims, and borrowing more money to pay those claims would simply indebt the county further.
“Self-insurance, even with stop-loss insurance, is wrought with so many uncertainties that it constitutes a risk of such great magnitude that it is irresponsible, if not potentially reckless,” Cohen wrote. “We must not gamble with taxpayers’ money.”
But County Manager David Fanslau and Legislature Chairman Jonathan Rouis contended that the county is on safe ground, has thoroughly studied the matter, and can handle the expense.
Indeed, they said ending participation in the state’s health insurance program in favor of setting aside county monies to pay claims directly is necessary to balance next year’s budget, which is already estimated to feature a $13 million gap.
“The cost avoidance that this program will realize is critical to the county’s budget process in 2012 and beyond, particularly when we are realizing reduced revenues and state aid, and a new property tax cap law,” Rouis explained.
Fanslau added that benefits will remain the same for users – a promise Teamsters Local 445 Business Agent Sandy Shaddock said the union will hold the county to.
“Our contract allows us instantly to go to arbitration” if a problem arises, she said yesterday – and the arbitrator must be someone with a medical background.
While disappointed in the vote, Shaddock said she saw it coming, and the union will eagerly participate in education sessions designed to inform current employees and retirees of their rights and obligations under the self-insurance program.
The changeover takes effect January 1.