County hit with hefty health insurance increase [Commonwealth Journal, Somerset, Ky.]

Nov. 17—It's open enrollment time for many citizens, and county employees are no different.

At Tuesday's meeting of Pulaski County Fiscal Court, local insurance agent Bill Neikirk presented magistrates with an update on health insurance for the coming year which includes a cost increase of nearly 25 percent.

"It started out as 30 percent rate increase," Neikirk noted. "We were able to get them [Humana] down to 24."

Neikirk went on to explain that while the county had previously enjoyed rates that ranged from either a rate hold to an 11-percent increase, this year marked a grim departure with four county employees submitting claims north of $200,000; two with claims between $100,000 and $200,000; and 23 with claims between $50,000 and $100,000.

"It's simple math and the fact that...the insurance company did lose 30 percent of everything they took in," Neikirk said.

The agent added that while the federal government reimbursed insurance companies for COVID-19 claims in 2020, that practice ended last January. Neikirk said that all his accounts are seeing an increase ranging from 10 to 25 percent.

"It's not just Humana," Neikirk said of the county's carrier. "All of my groups, I've got as much with Anthem as I do with Humana... There's nowhere to run with this. We do have a good insurance policy but even if you had a $5,000 deductible, you still would have seen a 25-percent rate increase. It's nothing to do with anything but COVID and just we all got hit with claims this year."

The county's plan includes 100 percent premium coverage for each of its employees, with only a $20 copay per office visit and $500 deductible. Deductions of employee checks are made only if they opt for coverage of spouse and/or children, as well as any other options available (such as extra life insurance).

County Treasurer Joan Isaacs advised the court that, in talking with other county treasurers around the commonwealth, she believed that insurance companies have instituted blanket increases of 10 percent due to the pandemic while acknowledging that the county was expecting some sort of increase due to the claims submitted.

"The COVID claims that the county has had are basically during this second wave," Isaacs added, referencing the lack of federal reimbursement.

The treasurer went on to say that she always builds an increase into the budget, and while this high an increase wasn't anticipated, the county coffers were doing well enough to absorb the cost.

"Our occupational tax is coming in well," Isaacs said. "We can't go out and spend willy-nilly but I know that we can make this work. It's going to be an increase that we weren't expecting but we have the money for it and I believe that our employees are worth it. They work hard and I believe that they earn good insurance. This is great insurance...and we're lucky to have what we have."

District 4 Magistrate Mark Ranshaw asked about the new premium and was told it amounted to $1,100 per employee per month.

Ranshaw also asked for occupational tax revenues. While Isaacs didn't have any definitive numbers, Judge-Executive Steve Kelley interjected that as of 2021's third quarter (calendar year), the tax had generated nearly as much as it had in all of 2020.

"We have a quarter left to go and we're almost even on the calendar year," Kelley said. "Things are very good in our county, our business community and our economic environment."

Ranshaw went on to say that the insurance increase will cost the county about $600,000 a year. Judge Kelley responded that the county has $2.6 million in ARPA (American Rescue Plan Act) funds for "lost revenues" that can be applied toward the cost.

"We can't just keep spending money on projects when we have an increase of $600,000," Magistrate Ranshaw continued. "We've got to watch what we're doing. We need to put more money in roads in our roads and in order to do that, we have to watch what we're spending on a daily basis."

Judge Kelley countered that when he took office in 2015, the county had to lay off employees due to budget constraints. "This court has worked hard to make things better, and we're at a point that we're the strongest we've been in a long time."

The judge asked Ranshaw to stop being negative and pointed out that road funds primarily come from the state gas tax, to which the magistrate responded he was being forward-thinking.

"We're not getting the gas tax," Magistrate Ranshaw said. "We have to come up with another solution to pay for these roads...I don't have a problem with this increase. I'm just saying we need to be forward-thinking of how we're going to take care of our roads, how we're going to do this. We can't be spending money on projects that we don't need to be spending money on."

Ranshaw didn't not specify what projects he was referring to but took exception when Judge Kelley said the county wasn't "going to sacrifice insurance to fix potholes."

"I never said it," the magistrate responded. "Did I say that? I said I was ok with this but we need to be forward-thinking on our other expenses to make sure our other expenses are covered too, like our roads and stuff like that."

"It's not just you that wants the roads better," Judge Kelley responded, asking the magistrate to "bring a solution."

"No, you need to help with the solution," Ranshaw fired back.

As the two county officials continued to bicker, District 5 Magistrate Mike Strunk cut the discussion short with a motion to accept the Humana plan as presented and retain Neikirk as the county's agent. The motion passed unanimously on a second from District 2 Magistrate Mike Wilson.

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