Boyd County officials heard pitches Tuesday for two new health care plans — one for employees, the other for inmates. Both claimed they could save taxpayers thousands of dollars in medical expenses over the coming year.
After hearing the plans, Fiscal Court officials ultimately decided to stick to its current employee health insurance plan but did not make a decision on their policy for the Boyd County Detention Center. Instead the court will hear from the jails’ current health care provider at its July 16 meeting before making a decision.
Leif Clarke, owner of the Benefactor Insurance Group in Ashland, encouraged the county to move away from its employee health insurance contract with Anthem Blue Cross and Blue Shield to a self-insured plan with Aetna Insurance.
Clarke told officials that switching to self-insured model would allow them to “take charge” of their plan, instead of continuing running on the “treadmill” of continuously increasing premiums. Clarke explained insurance companies raise contract plans following years of higher than expected costs but never decrease them following years of lower costs.
According to Judge-executive William “Bud” Stevens, Anthem will not raised the county’s premium for the upcoming year based on claims being significantly lower than it’s premium payments so far this year. Dental costs are expected to rise 4 percent, however.
During the first eight months of the 2012-2013 fiscal year, the county paid $1.26 million in health care premiums, but employees made only $886,000 worth of claims, said Clarke. If the trend continues through the year, the county will pay out $2.1 million in premiums but make only $1.3 million in claims, meaning Anthem will profit to the tune of more than $800,000 at taxpayers expense, said Clarke.
Under the self-insured plan through Aetna, Clarke proposed the county will pay a premium of $2 million, with a $2.2 million cap if claims outpace the premium. Employee deductibles and co-pays would remain the same.
If expenses go over the premium cap, said Clarke, the premium would likely be raised the next year as it would under Anthem. However, any left over premiums that are not used for claims instead of being forfeited for profit would go back to the county for health insurance the following year.
Citing “fear of the unknown,” commissioners decided to stick to Anthem and renew their contract — for now. Health insurance is a month-by-month contract, said officials.
“It sounds very attractive but I don’t know what is going to take place in the future,” said Stevens noting of his tenure in office this has been the only year where the counties premium has outpaced its claims. “I think we need another year,” he said.
“I don’t think you can base your decision on one good year,” said Commissioner Tom Jackson, explaining his vote.
Commissioner Carl Tolliver was skeptical at first but seemed to grow more favorable toward making the switch as the meeting progressed. “We need to feel more comfortable,” he said, noting he’d be more inclined next year if “we can see that we are staying in the same (cost) range.”
Commissioner David Salisbury also cited the city of Ashland’s experience, which has battled rising health care costs in the last year despite being self-insured. He pointed out it would also be the third change to employee health care in as many years.
Stevens said he is also concerned the county’s aging workforce could drive claims up and has concerns over how the implementation of the Affordable Healthcare Act would affect costs.
Clarke said self-insured policies have an advantage under Affordable Healthcare Act, also known as Obamacare. He also told commissioners he would not give up on trying to convince them to switch. “I’m going to be here fighting for taxpayers and employees every year,” he said.
Following that discussion, the fiscal court heart from Alan Adams with Correct Health, an Atlanta-based company that provides health care to jails and correctional facilities. Adams told commissioners he believes switching from Advanced Professional Health Care to his company will save the county on spiraling inmate health care costs by cutting down on out-of-facility transfers for care.
Boyd county has budgeted $426,374 for inmate medical expenses in 2013-2014 including $184,000 for care outside the jail in addition to the county’s contract with Advanced. Adams called “unusually high,” saying he believes his company can save Boyd up to $100,000 through utilization of its “telehealth” system that allows an inmate to be seen by a doctor or specialist without leaving the jail.
Last week, after hearing a similar pitch from Adams, Carter County Fiscal Court officials hired Correct Health instead of renewing their policy with Advanced. Boyd and Carter Counties are currently under a injunction barring them from creating the joint Northeast Kentucky Jail Authority until a lawsuit challenging its legality is settled.
Boyd County Jailer Joe Burchett said he’s been satisfied with Advanced and would like to remain under contract with that company.
CARRIE STAMBAUGH can be reached (606) 326-2653 or by email at firstname.lastname@example.org