The County Line
- Volume 54, Number 1 - 2010
By ACCA Executive Director Sonny Brasfield
ACCA’s Task Force on Health Insurance Costs tackles a monumental problem.
Can the Association find ways to curb the rising costs of health care and still provide quality coverage and service?
During his speech last August ACCA President Larry White set a goal for the Association to develop recommendations to curb the escalating costs of health insurance for county employees and dependents. It was easy to say, but is proving much harder to do.
The issue of health care reform has dominated all activities in our nation’s Capitol for more than a year. So, focusing our attention on this matter is a bit ambitious. The challenge placed before us was to look at changes that could be made in the Local Government Health Insurance Program to slow the annual hike in health insurance premiums.
Most counties pay all, or at least a substantial portion, of the cost of “single” coverage for their employees. These annual increases hit the county, as well as its employees, directly in the pocketbook.
We were not expected to wade through the “reconciliation” or “no-reconciliation” questions, which were the top national news stories in early March. And, we weren’t in the middle of the back-and-forth over the establishment of a public option for health care or the proposed tax on the top-of-the-line health insurance programs.
Our charge was simple, at least simple to say: Find ways to reduce the premium charged for health insurance coverage through the Local Government Health Insurance Program.
We’ve been joined in this effort by the staff of the State Employees Insurance Fund, which provides administrative direction for the local government program.
The insight of William Ashmore, chief executive officer of the fund, has been most helpful in the work of the ACCA Task Force on Health Insurance Costs. His support will be important as we move forward with implementation of some ideas.
The ACCA task force, chaired by ACCA Second Vice-President and Etowah County Commissioner Tim Choate, is composed of commissioners and administrators from across the state, including Lee County Administrator and President of the Association of County Administrators of Alabama Roger Rendleman, and several past presidents of ACCA.
Our work began with a survey of the Association’s membership to determine satisfaction with the current health insurance program, which provides coverage for the employees and dependents of most counties, as well as suggestions for improvements or changes that could
be considered in order to reduce costs.
This program was established by Alabama law, primarily as a result of difficulty counties and cities experienced with securing satisfactory coverage for their employees.
Some 74 percent of survey respondents reported being either “very satisfied” or “satisfied” with the program, and only 8 percent were not satisfied with the program. A similar percentage of respondents said they would recommend participation in the program to other counties.
So, in a nutshell, counties are satisfied with the service and coverage, but they are concerned about the cost.
Respondents identified several improvements they would like to see in the program, the most popular being the use of a “drug card” rather than reimbursement for prescriptions, and the addition of vision coverage to the program. These, and any other improvements, mean more money.
Not surprisingly, when advised that these measures would likely increase their premiums, almost 60 percent said they would oppose any improvements or changes in coverage that carried a net increase in costs.
For that reason, most of those ideas have been set aside for another time.
Survey participants were also asked to rate their support of several coverage changes that would reduce costs.
More than 60 percent of the respondents supported the following changes aimed at reducing monthly premiums: required participation in wellness screenings; required utilization of generic drugs (if available); a reduction in the reimbursement rate for those who use emergency rooms for non-emergency issues; and a surcharge on tobacco users.
Obviously, most of these suggestions relate to personal behavior and health choices, rather than changes in benefits. There appears to be little support for changing benefits, meaning the only way to reduce expenses is to alter the behavior of those who participate in the program.
The task force first met in December and focused on an in-depth discussion of these options and several others surfaced by the committee.
A list of possible recommendations was forwarded to Ashmore for evaluation and an actuarial study of the possible savings from each change. The group recently reconvened in early March and reviewed the information and recommendations from Ashmore, as well as an estimate of the savings and/or costs of the changes.
Final work of the task force will be passed on to the ACCA Board and the Advisory Committee for the Local Government Health Insurance Program. This process should be completed in time for some of these recommendations to be considered when setting the premium rates this summer.
Will any of these ideas reduce costs immediately? I would doubt it. But over time, several of these proposals should work to at least slow the rising premium costs.
That’s an admirable goal and one that, perhaps, can be achieved in the long run by working together.
For President White, the important news is the Task Force’s work continues and the members are focused on the goals he set in August.
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