Lawsuit Threat Pushes Pa Commissioners To Switch Plan On Health Insurance

Oct. 28--For the second time in two years, the Butler County commissioners switched course on health insurance providers after awarding a new contract, this time under a lawsuit threat.

The commissioners two weeks ago approved switching from self-insurance to a fully insured plan through the County Employee Benefits Consortium of Ohio (CEBCO) with Anthem.

On Monday, they rescinded that contract and approved staying with United Healthcare for another year at a cost of $21.2 million. The CEBCO cost was $21.3 million, a $128,000 difference, according to County Administrator Judi Boyko. The insurance premium increase is 2.2% over this year.

The health insurance issue has been a difficult one for the county because of rising costs in recent years.

Commissioner Don Dixon told the Journal-News that United Healthcare threatened to sue because the commissioners' broker didn't put out a request for proposals so the process was flawed. He said while it wasn't the county's error per se, "the buck stops here."

"It was technicality that really led us to go back and stay with the company that we were with last year," Dixon said. "We were advised by the prosecutor's office that it was the proper thing to do, we didn't want to spend a bunch of money litigating the question."

County Administrator Judi Boyko said she doesn't anticipate issues with rescinding the CEBCO contract because they were given notice of the commissioners' intent to cancel.

Commissioner T.C. Rogers said now was probably not the best time to switch companies anyway.

"Especially as we are in the period where you make your health program determinations it is in the best interest of our employees that we stay with UHC," Rogers said. "Along with this though we have decided there would be no increase to our employees."

The commissioners did an about face two years ago after an uncharacteristic battle amongst the three commissioners. Dixon and Rogers favored Medical Mutual of Ohio and authorized contract negotiations. Commissioner Cindy Carpenter wanted United Healthcare.

The commissioners ultimately rescinded the resolution approving MMO and hired UHC.

The county went to a self-insurance model in 2017 after several years of double-digit percentage increases for insurance coverage. Some large, unusual claims over several years drove those increases, including a single $5 million claim in 2013 and a $3 million claims month in November 2014.

The commissioners at the time said they wanted more control over their costs but Dixon said when they made the switch two weeks ago, the cost difference between self-insurance and traditional coverage was negligible when figuring in reduced risk.

"I think in light of all the issues we're dealing with with COVID and the testing and what effects are left after you do have COVID in the long run," he said. "I think it's a very prudent move to financially lock down our rates going through these times."

Under the self-insured plan, the county pays an administrative fee and the claims itself out of county coffers. There was a single claim limit of $175,000 and a total limit of $20.8 million, so any bills over those amounts are paid by United Healthcare.

"We will make sure the next time our broker goes out for quotes. It's not the end of the world," Dixon said. "They're a good health care company. We just had an opportunity to limit our exposure and we're not going to have that. It could work both ways for us, expenses could come in less and we could save a little money."

The total claims last year were $16.5 million and the commissioners had budgeted $20 million. Boyko told the Journal-News as of Sept. 14 the county has had almost $12 million in claims, about $1 million more than a year ago.

Human Resources Director Laurie Murphy said since July 2018 the county has had 35 claims between $175,000 and $250,000 and 25 claims in the $250,000 to $500,000 range.

CONTINUING COVERAGE

The Journal-News has done multiple stories this month on Butler County budgets and finances heading into 2021 as the only media outlet to monitor the county's budget hearings. We will continue to use reporters in our communities to follow the important stories for taxpayers.

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