While reviewing the proposed 2018 fiscal year budget on Wednesday, Washington County Mayor Dan Eldridge and Budget Committee members expected to pay a little more for county employees’ health plans next year.
Just not $1.97 million more.
According to projections from TIS Insurance Services, a consulting firm hired by the county, healthcare coverage for the 450-plus Washington County employees is expected to increase by a total of 37.5 percent compared to last year.
Even with a 10 percent employee contribution match, TIS projected Blue Cross Blue Shield’s claims to increase from $4.95 million in 2017 to $6.68 million in 2018.
“(TIS) have come up with a projection of a 35 percent increase in claims for the coming year, which approaches a couple million dollars,” Mayor Dan Eldridge said. “When you compare the projected claims for 2018 to the actual claims for 2016, we’re talking about a 50 percent increase.”
Costs associated with the county’s employee clinic are also expected to increase 5 percent and county employee’s self-insured related costs are projected to increase by about $250,000.
If the trend continues, some county officials speculated whether the county should or even could stay in the health insurance business.
Analyzing the overall budget for the upcoming year, the spike in healthcare coverage costs certainly contributed to the county’s $1.34 million projected deficit when comparing revenues over expenditures.
“We’ve easily got a balanced budget until we get to the projected claims in our health insurance plan,” Eldridge said.
To clear that deficit, the committee’s options were narrowed to either raising taxes or making cuts, a common theme during this year’s budget process.
Echoing members of the panel, Eldridge said officials aren’t willing to pass those costs along to taxpayers in the form of a tax increase, leaving cuts as the only option.
Committee members mentioned asking county officials from most departments to cut a collective 5 percent from the upcoming budget, but no official decisions were made.
“That means, if we’re going to continue to provide the benefit to the employees, which I expect we will, then we have got to figure out another way to manage within the revenue that we have in the county. I think that’s really what the conversation was about here today,” the mayor said.
“We’re going to go back and we’re going to scrub this budget. We’re going to look at opportunities to work with the officials to see if they’ve got room in their numbers. We have to live within the means that we have.”
One of the factors that created the insurance increase is a general surge in the health-related service costs, but the region’s aging population is likely another determinant.
“Washington County’s employees are, on average, about nine years older than the county average. Obviously, there is going to be more healthcare costs associated with that,” Eldridge said. “Because of the changing dynamic in healthcare, this is apparently just a structural change in what health care is going to cost.”
The Budget Committee will convene again at noon Friday with hopes of getting an updated cost projection from TIS, as well as the latest Board of Education budget.
|Washington County Insurance Fund Cost
|Insurance and Administrative Costs
|Blue Cross Blue Shied Claims Projection
|Total Projected Net Costs
Email Zach Vance at [email protected] Follow Zach Vance on Twitter at @ZachVanceJCP. Like him on Facebook at Facebook.com/ZachVanceJCP.