Insurance gap could cost county $20,000
Published 12:14 am Thursday, March 9, 2017
NATCHEZ — Adams County may be forced to pay another $20,000 to its employee health care coverage re-insurance provider to cover a gap in coverage.
Under the county’s self-funded insurance plan, Blue Cross Blue Shield acts as the administrator.
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The county pays claims for each employee up to a deductible of $50,000, at which point re-insurance kicks in and pays any value above the $50,000 cap. The county’s re-insurance agent is Jules Lacoste, vice president of sales for TRU Services.
Lacoste said Wednesday so far under this year’s plan, 13 employees are close to reaching the $50,000 deductible and four have gone above it. Numbers for March still have to be calculated.
The county has 206 employees on the insurance plan, County Administrator Joe Murray said.
The gap exists in the county’s current plan where an employee who goes above the $50,000 deductible were to receive the medical services before the end of the county’s insurance contract on April 1, but the bill not be submitted until April 1 or later.
“Why is that?” Board President Mike Lazarus said. “That does not make any sense.”
Lacoste said because the county accepted the contract this past year in which his company would have less risk at a savings to the county of 20 percent.
Some supervisors had understood Monday that as long as the contract was renewed with the company, the gap would be eliminated, but Lacoste clarified Wednesday the new contract would not negate the gap liability.
Lacoste said if the county opted for a plan in which his company took on liability dating back to April 1, 2016, then the county would be covered in the gap-risk scenario. Lacoste said he would charge an additional 4 percent under this plan. Lacoste said the normal rate for this type of contract is 20 percent, which is what the county would have been charged last year.
Lacoste said if enrollment were the same in 2017-18 as it was in 2016-17, then 4 percent would cost the county approximately $20,000.
Lazarus said the county would have to accept the 4-percent increase.
“It leaves a bad taste in my mouth, but we don’t have a choice,” Lazarus said.
With the county projecting to save approximately $250,000 based on what was budgeted for insurance, Murray said next year’s savings could be more substantial based on a couple of factors.
Murray said many of the people who have health issues have gotten them resolved and one employee with a costly health problem will be switching to Medicare insurance.
Murray also said one of the main issues when the county switched from a self-funded insurance plan to a fully-insured plan in 2013 was high-risk employees. A few employees were placed in a high-risk pool in which the county had to cover expenses up to $150,000.
Murray said no employees are in a high-risk pool for re-insurance purposes, and county insurance agent Randy Hazlip said last year he had negotiated to keep a straight $50,000 deductible.
“It is looking like we will have a good year,” Murray said.
Supervisors delayed Wednesday deciding whether to renew the same kind of health care coverage again for the coming year.
District 5 Supervisor Calvin Butler said he had heard enough of the options to make his decision, but wanted to delay the vote out of fairness to District 4 Supervisor Ricky Gray, who had questions about the policy Monday but was unable to attend. District 2 Supervisor David Carter was also absent.
Gray’s primary concern Monday had been about the gap in coverage, so supervisors wanted Gray to have an opportunity to understand how the issue could be resolved.
“My only concern is getting what is best for Adams County and the employees,” Gray said after the meeting via a telephone interview.
The next regularly scheduled county meeting is on at 9 a.m. March 20.
Board Attorney Scott Slover expressed concerns March 20 may be too late if the county does not accept one of the options on the table, but Lazarus said he believes the county has the votes to accept one of the options.