Indiana Supreme Court case mulls whether counties can strip health insurance from elected officials

INDIANAPOLIS — Are elected officials entitled to health insurance regardless of the number of hours they work?

That question is before the Indiana Supreme Court, who heard arguments in a Perry County case Thursday that could have statewide implications for local officials.

The case began after the Perry County commissioners discontinued health insurance coverage for certain part-time county employees in June 2023. A Perry County councilman, Keith Huck, sued and sought an injunction to keep his insurance. He works about nine hours a month, according to evidence in the case.

A local judge granted Huck's injunction, but the Indiana Court of Appeals disagreed. The appeal to the Indiana Supreme court is interlocutory, meaning it is occurring while the case is ongoing.

"This court should declare that local unit elected officials who work less than 30 hours a week should be part-time employees for purposes of group health benefits," said attorney Maggie Smith, representing Perry County.

"Exempting all local unit elected officials from being considered part-time employees will have such a drastic fiscal impact on the public's fisc that such an exemption should be the result of a public policy decision of the Legislature, and that has not happened yet," she added.

She argued that state law gives local units the right to not offer health insurance to part-time employees and that's what Perry County did when facing a fiscal crisis.

The decision impacted 12 of the 21 local elected officials they deemed part-time, including the Perry County commissioners who made the decision.

Indiana Supreme Court Chief Justice Loretta Rush pointed out that state law says elected county officials are not required to report hours and can't determine or change compensation based on the number of hours worked. She asked if insurance is part of compensation.

Smith said it isn't part of compensation at the county level and said counties are allowed to exempt part-time employees from health care benefits. She also acknowledged confusion between statutes.

"I agree with you that these statutes, as is sometimes the case, are not the pillar of clarity, but the answer to that in this case is precisely why this court should not create rights that have such a significant financial impact," she said.

Justice Geoffrey Slaughter said county council members on the same board could work different hours and therefore one could be eligible for insurance and the other not. Supreme Court Justice Mark Massa also noted there are elected county prosecutors in smaller communities that might not meet 30 hours a week.

Attorney Robert Burkart, representing Huck, said a county can choose not to offer insurance at all, but if they do, then elected officials have a right to participate.

Slaughter questioned that contention: "Essential to your argument is that the county cannot treat elected officials as part-time employees. But where does it say that?"

Burkart said justices must look at a progression of statutes from 1957 to 1990 and to a non-binding attorney general opinion from 1978.

"Basically, the General Assembly giveth and only the General Assembly can taketh away from elected officials if the insurance is offered," he said.

The court also has to consider whether Huck losing county-paid insurance counts as irreparable harm that would require an injunction. Smith said Huck could have gone on COBRA insurance or bought a plan on the marketplace.

But Burkart said the plans would have different levels of protection and there would be continuity of care issues.

But Slaughter said Huck can receive damages at the end of the case if he wins to cover his losses.