Board approves increase in costs
By Steve Herring
Published in News on April 6, 2016 1:46 PM
Wayne County commissioners Tuesday morning voted 4-3 not once, but twice before settling on an increase in out-of-pocket medical insurance costs over an increase in premiums.
But for both sides the divide came down to what would benefit employees more -- eliminating the premium increase in order to safeguard continued salary adjustments or allowing a slight increase to keep out-of-pocket expenses from eating into employee pay.
The county's self-insurance plan had been facing a 9.3 percent increase that would have cost an additional $629,439 -- most of which would have been shouldered by the county that pays the premium for employees who in turn pay for any dependent coverage.
Commissioners Wayne Aycock, Joe Gurley and Mayo, favored an option that would have cost slightly more in premiums, but that would left co-pays and deductibles unchanged.
Commissioners John Bell, Bill Pate, Joe Daughtery and Ed Cromartie preferred a plan that would leave the premiums where they are, but that would increase some out-of-pocket costs.
County Manager George Wood reminded the board that insurance broker Mark III had been asked to come up with options to reduce the 9.3 percent increase.
One option would have reduced the increase to 5.3 percent ($359,204), while a second would second option would lowered the increase to 4.3 percent ($291,167) and was the one favored by Aycock, Mayo and Gurley.
The third option, the one recommended by Wood, got the cost increase to zero percent, but at a cost of higher co-pays and deductibles.
"We were projected to get an increase of 9.3 percent this year," Wood said. "A large driver of that increase is a 30.8 percent increase in pharmacy utilization and price increases. Obviously, the county cannot afford a 9.3 percent increase on a budgeted $6.75 million budget for medical insurance.
"That would require an additional $629,439. While some of that would come from employees who pay for their dependent coverage, the overwhelming amount is paid for by the county for each employee's health insurance."
In response to questioning by Bell, Wood said he thought his recommendation was in the best interest of county employees.
Pate made the motion to adopt Wood's recommendation.
But Mayo argued that the timing was "terrible" because the county has yet to look at the pay scales in some departments.
"We have an exodus of employees to other counties, and most of what the exist interviews are saying is that a lot of it is caused by pay," Mayo said.
Mayo said commissioners make things happen when they want them to.
"We say we don't have any money," he said. "Well, we will find the money if we want to do it. I am going to make a counter motion to Mr. Pate's motion that we accept option two of this plan, and furthermore the difference that we need to do to make a salary adjustment, a salary study if you will, like we have with the Sheriff's Department and OES (Office of Emergency Services), that we either do a budget amendment or we take the money our of fund balance.
"We have taken millions of dollars out of our fund balance for different projects. I think it is a win-win situation if we show the employees that we are concerned about them by sharing this as option two."
The amendment failed by a 4-3 margin with Mayo, Gurley and Aycock voting for it, and Bell, Pate, Daughtery and Cromartie voting no.
Pate's original motion passed by the same margin with Mayo, Gurley and Aycock voting no.
"It really comes down to how you want to save the money," Wood said. "Do you want to put $291,167 into paying more into medical insurance or do you want to save it and put it toward the raises which would help offset some of these co-pays and deductible that we are having to put in place?
"We know that our medical insurance plan is really good relative to other people. But we know that our pay is low in some areas relative to other counties. We are trying to improve that."
The county this year addressed the Sheriff's Office, Office of Emergency Service and jail, Wood said. Other departments remain, particularly the Department of Social Service and Health Department, he said.
"So what I am recommending to you is save the $291,000 by going with the plan which is no increase in the premium," he said. "That saves $291,000 and the bulk of that would be the county, and let us use that money to go to merit increases and reclassifications of positions to get that pay up which is lower than we know it ought to be."