Health care consortium moves forward

Lockport Union-Sun & Journal (NY)

Oct. 22--County officials aim to have a health care consortium in place by January 2019 as a way to save on employee health insurance.

During a meeting Thursday night in Somerset Town Hall, Somerset Supervisor Dan Engert updated members of an ad hoc committee which includes representatives of each of the 21 municipalities now in the consortium.

Engert, committee chairman, said their plan is to put out a request for proposals for health insurance carriers by next January. They would show the bids to each of the municipalities in the consortium by February or March, and begin forming the consortium by the third quarter of 2018.

At this point, 21 municipalities have expressed interest in joining the consortium, including Niagara County, the cities of Lockport and Niagara Falls, most towns in the county and the villages of Lewiston, Youngstown, Middleport and Barker.

"If formed, this would be the largest municipal health care consortium in Western New York," Engert said. "It would create a very competitive market position for the consortium."

Engert said a soft RFP issued during phase one of the consortium formation process identified projected annual savings of about 20 percent.

"The market share for having more than 2,500 employees is huge. ... We're very confident the market will demonstrate that 20 percent savings if not more," Engert said.

In September, Engert was notified the county would be awarded about $15.8 million.

The New York State Department of State awarded Niagara County the money "because it reviewed their submission and felt it's a worthy initiative to implement," Engert said. He called it "a tremendous award for Niagara County."

Laz Benitez, public information officer for the New York State Department of State, said in a statement that the Town of Somerset, along with 23 other local governments and school districts in Niagara County, applied to the Local Government Efficiency (LGE) Program (the town and village of Wilson have since dropped out). They did this in July of 2015 for funding assistance to begin the establishment of a cooperative of local governments necessary "to establish a health insurance consortium."

According to that application, Benitez wrote, the purpose was to begin to create the inter-municipal structure to share the costs of self-funding health benefit plans, stabilize health claims' costs and negotiate with health providers by spreading costs among a larger pool of risk.

"At that time, the application noted that the Town of Somerset and its 23 partners spent nearly $50 million to provide employee health insurance coverage, through 50 separate health insurance plans," Benitez said in the statement.

Engert said health insurance is a major cost for municipal governments, typically accounting for between 20 and 26 percent of total spending.

"We're just very excited about this potential opportunity and the impact this could have on taxpayer burdens in Niagara County," Engert said.

Engert added that any municipality or school district can join the consortium. Representatives for any group interested in joining the consortium should contact Engert.

___

Visit the Lockport Union-Sun & Journal (Lockport, N.Y.) at lockportjournal.com

Distributed by Tribune Content Agency, LLC.