County insurance plans to increase
By Steve Herring
Published in News on March 17, 2016 1:46 PM
Inflation and a nearly 31 percent jump in pharmacy use are being blamed for a projected 9.3 increase in Wayne County's self-insurance plan.
The 9.3 percent translates into an additional $629,439 that would be needed to fund the plan -- an increase that officials say the county can ill afford in the face of added expenses to staff the new jail and operation costs for the proposed new agriculture and convention center.
It could also adversely impact the county's continuing efforts to update and improve its position classification and pay plan.
Wayne County commissioners spent nearly two hours Tuesday discussing the medical insurance plan, including talks with consultants with insurance broker Mark III that provided several options to consider.
The agenda had allocated 10 minutes for the discussion, but commissioners agreed with Chairman Joe Daughtery to shift the issue over to a work session before being tabled until the board's April 4 session.
County Manager George Wood told commissioners that they can expect to see similar increases annually going forward.
The county currently pays the insurance premium for employees who in turn pay for any dependent coverage.
Wood said that he had asked Mark III to come up with options to reduce the 9.3 percent increase to zero in order to keep the employees' dependent coverage premiums the same.
Under one option the cost would increase by 5.3 percent ($359,204). A second option would lower the increase to 4.3 percent ($291,167).
The third option that had been recommended by Wood got the cost increase to zero percent, but would increase:
* Specialist physician from $60 to $70 in-network co-pay.
* Deductible for an individual, from $1,500 to $1,750.
* Deductible for a family, maximum from $3,000 to $3,500.
* Co-insurance for individual, maximum from $1,000 to $1,750.
* Co-insurance for a family, maximum from $2,000 to $3,500.
Pharmacy changes would be:
* Adding a $150 deductible.
* Leaving generics at $10 to encourage their use.
* Increasing preferred drugs from $45 to $60.
* Increasing non-preferred drugs from $60 to $75.
* Keeping specialty drugs at 25 percent of cost, with a maximum co-pay of $100.
"Let me address the $150 deductible on the pharmacy because you will notice that nobody else (nearby counties) yet is doing that," Wood said. "That is a growing trend though. I went to these about four years ago in Lincolnton (as Lincoln County manager). We did it for the same reason because one of the fast-growing components of health care is pharmaceuticals We are the most over-medicated population in the world I believe.
"But the growth continues and it is both -- it is inflation on pharmacy but it is also increased utilization of pharmacy. The increase in our utilization was over 30 percent. So you have the $150 deductible as a way to addressing some of that."
A person has to meet that deductible before the plan kicks in, he said.
Also, keeping the cost for generics low is a way to encourage using those drugs instead of the higher-priced ones, Wood said.
Commissioner Joe Gurley asked if it was possible for the county to send out a request for proposals from local drug stores that might be willing to provide cheaper drug costs.
"I am not trying to dissuade you, but you will get a tremendous amount of blowback," Wood said.