Still nothing definite on Bath health insurance By Amanda Isley • Staff writer
WARM SPRINGS - Bath supervisors still haven't received a solid rate proposal from bidding insurance companies Anthem and Southern Health.
Insurance consultant George Weikel, of Business Solutions in Salem, said he is still in negotiations with both companies in order to secure the lowest possible rate. The county is seeking the best contract for county staff.
Supervisors and school board members met last Tuesday for a joint budget work session, where Weikel gave an update on his findings and said he hoped to finalize information to present to the health insurance committee in two weeks.
The committee consists of supervisor Stuart Hall, county administrator Bonnie Johnson, and school superintendent David Smith. Weikel said his intention is to have representatives from Anthem and Southern Health give presentations to that committee within the next week.
Currently, the county is insured by Local Choice, a branch of Anthem, through the end of June. Due to rising premium costs, both boards agreed to release a request for bids for fiscal year 2007-08.
Based on the information Weikel has gathered, it would save the county money to opt out of the Local Choice plan. "It looks like at this point, if you do elect to leave Local Choice and go with either Anthem or Southern Health, there could be some savings in premiums," he said.
Weikel plans on having information finalized in time for next month's board meeting. "That gives us ample time to hold employee meetings," he explained.
School board member Barbara Waldeck wanted to know if the companies that submitted proposals offered comparable benefit packages. Weikel assured her they mirrored the current benefit structure as closely as possible in order to provide a base for comparison.
Smith was concerned the county might incur a substantial financial penalty, based on information he had received from Local Choice in the past, if it opted out of the plan.
Weikel said he could not speak on behalf of Local Choice, but that the county has $20 million in excess reserve funds. "The county ended the (last) year in a very good financial position," he explained. "I hardly think you are going to owe anything with an excess reserve of $20 million."
In addition, he said Anthem representatives projected it was unlikely the county would have to pay any type of penalty.
Smith also asked how the size of the insured group affected rates. Weikel explained rates were technically affected by the demographics of the area and were primarily determined by the number and expense of the claims. But because one large claim can affect a small group, larger groups provide more rate stability because the fixed cost insurance companies charge is based on size, he said.
Supervisor Jon Trees was curious about how wellness plans affected rates. Weikel is a strong advocate for groups implementing wellness plans, he said, but warned results would not appear within a year. "I think everybody should spend 3 percent on wellness programs, but it's going to be a long-range effect," he said.
Supervisor Cliff Gilchrest said he thought maybe the county would see a decline in rates three to five years after implementing the wellness plan which went into effect last year; Weikel agreed that was a reasonable time frame.
Weikel emphasized the need for a group to continually remind employees about health offerings to encourage participation. He pointed out a wellness plan is moot if no one is taking advantage of it.
In addition, Trees wanted to know specifics on why Weikel had referred to the Bath health insurance plan as the "Cadillac of plans" earlier in the evening. Weikel said he believed Bath had "a very rich plan."
"I (work with) a lot of large corporations and their plans are nowhere near as rich as this plan. They have larger deductibles, larger out-of-pockets. For example, under dental coverage, your plan covers all four stages of dental coverage and most just have basic dental coverage," he said.
The Bath plan covers orthodontics and crowns, while basic plans just cover check-ups and routine cleaning and maintenance, he added.
Trees asked if benefits that were not used by many people frequently could be cut to lower rates. Weikel replied that benefit structure could definitely affect rates and could be looked at in the future.
Trees supported researching ways to eliminate any superfluous benefits. "We need to look at things that could be trimmed, that aren't being used. We've got to save every penny," he said.
School board member Kaye May is an advocate for removing one plus one and family coverage as options, and convert to employee-only health insurance, as paid for by the county. She argued employees should get pay raises and then have the option to pay for family coverage themselves. "I don't think Bath can continue to absorb the rising cost of premiums for family coverage," she said.
Supervisor Richard Byrd disagreed. He said he was not in favor of eliminating family coverage and wanted to leave it as an option. He argued the money would get spent either way, on raises or insurance, and said the board had no control on what type of insurance coverage its employees chose.
May stressed it would be redistributed more evenly across all employees and provide a fair benefit to everyone. "What you can control is how much cost you absorb. Some employees may want a smaller plan; instead of a Cadillac, they may want an Oldsmobile," she said.
Gilchrest said, "I know this has been an issue for years, and I think all of us on the board want to do what we can for both county and school employees. We're going to wrestle with this."
This week, supervisors postponed making a decision on insurance coverage until after county and school employees had seen presentations from Anthem and Southern Health insurance companies. There will be an informational meeting for school and county employees Thursday (today) at 4:15 p.m. at Bath County High School. The board of supervisors hope to make a decision at its continued meeting Tuesday, April 17 beginning at 6:30 p.m.
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