The Greene County Commission and county office holders held a contentious meeting Tuesday afternoon regarding the healthcare plan for county employees.
The end result of the meeting was a split 2-1 vote by the Commission to withdraw from the county’s plan under Midwest Public Risk in favor of a health and dental plan from United Healthcare and a vision plan from Kansas City Life that would take effect on July 1, 2020.
The county will have to pay a $75,000 penalty for leaving the MPR contract a year early, and there is an additional $80,000 that would be plaid back to the county from MPR that will be forgoed by the ending of the contract.
Commissioners Bob Dixon and John Russell voted in favor; Commissioner Harold Bengsch voted no.
Bengsch’s no vote came after he expressed misgivings about Sheriff Jim Arnott and Prosecutor Dan Patterson saying they could be removing their offices from the county’s overall plan (thus cutting the number of employees, reducing leverage of the county) if the Commission left the agreement with Midwest.
“With what has been thrown at us today with our two largest departments potentially threatening to do what they said [pulling out of the county plan],” Bengsch said, “I’m reminded of the old saying a house divided against itself cannot stand.”
Potential Three Million Dollar Cost Increase in 2 Years
An internal document sent to the County’s elected officials for a March 25th meeting obtained by OI showed the plan in question could end up costing the county nearly $3 million.MPR-v-UHC-Cost-Proposal
Greene County Commissioner John Russell, the primary advocate for the change, told OI that the numbers in that document were “the absolute worst case scenario” and would apply only if the county were to have claims that would exceed 100% of the plan’s cost over multiple years.
Russell said the deal passed by the Commissioners actually increases the savings in the agreement.
“The first year savings would indeed be a combined $896,316 provided the $136,535 savings figure is valid (2% UHC dental discount),” Russell told OI. “That figure, however, excludes cost differences created by the hiring of additional jail staff, which would be a potential additional savings of $49,880. This would bring savings up to $946,196.”
Russell also pointed out that if the county comes in under that worst case scenario presented in the other document, the county can actually have savings under the second year with United Healthcare:
If those same savings are achieved again in year two, Russell then stated the county will receive:
- Loss ratio over 100: 2-year savings = $102,692
- Loss ratio 95.1-99: 2-year savings = $375,762
- Loss ratio 90.1-95: 2-year savings = $607,871
“It’s a balancing act,” Russell said. “You have to look at host term proposition and the long term for the employee and the county taxpayer. I see substantial savings for the first couple years, potentially beyond that, the long-term gain of having our own data which we don’t have now.”
Russell noted the Commission could back out of the deal at the end of any year, so if a major spike was likely to happen they could take action to withdraw before that price spike.
Russell also noted that the new plan has both Mercy and CoxHealth as “in-network” health care systems, where under the old plan only Mercy was considered “in-network.”
Control of the Claim Data
The bigger issue to Russell, and eventually Presiding Commissioner Dixon, is the lack of ability for the county to have access to claim data.
The agreement with MPR has the county as part of a pool of other counties, allowing them to negotiate as a larger unit, share the overall healthcare costs, thus keeping down the overall costs for counties and rates for employees.
It also allows counties to keep costs from spiking if they have a year or two where they go over 100% of costs; the other members will absorb that increase while in years a county may be under 100% they will absorb the cost of other members who are over that rate.
“[The pool system] gives you a level of stability,” Greene County Auditor Cindy Stein told OI.
An issue with the pooling of the claims is that they are not broken out by individual county or employer entity; and the county cannot have a record of what percentage of claims were made against their overall contribution for the year.
Because the county does not have that information, it is limited on the number of bids it received for health insurance or makes the bids extraordinarily high because insurers do not know how much of a risk the county would be for them to insure.
“On a large group like the county, 900 eligible employees, carriers want to see how the group is performing,” Russell told OI. “What are the loss runs? Without that data, most are hesitant to provide quotes. UHC provided one with limited information. Many carriers declined to quote. Those who did were so high it wasn’t viable to consider them.”
Russell said that the county will have more flexibility in the future with the data, and that’s a primary reason a change must be made now.
“Once we have 2 or 3 years of data, we can look at more carriers and even consider self-insurance at some point,” Russell said.
Russell provided OI with a spreadsheet showing the final evaluations.
Dixon vs. Arnott
The result of the vote had Greene County Sheriff Jim Arnott following through with his statements to the Commission, announcing he would immediately remove his employees from the county plan, and keeping all of his employees with the Midwest Public Risk plan.
Arnott told OI that he would be keeping the current plan that is in place for all his employees with the same benefits. The money is allotted for the sheriff under his budget for the fiscal year to pay for the healthcare plan.
The exchanges between Arnott and Presiding Commissioner Bob Dixon were the most tense moments of the meeting.
“The passion and intensity with which people want to stay with MPR to the point that we would be withdrawing sections of our employees and essentially chop ourselves up into small pieces surprises me,” Dixon said after both Arnott and Patterson expressed their consideration to separate. “It troubles me. I don’t believe that is in the best interest of the employees. And again, I feel that I have not one but two guns held to me and I don’t like making decisions that way. I don’t think it’s right.”
“Then you know how I feel when you make a decision that affects all my employees,” Arnott responded.
“And they’re my employees,” Arnott continued. “They’re not Greene County’s employees, they’re the Sheriff’s Office employees. I hire them, I fire them, and I’m the one that has to take care of them. And so that’s who gets the backlash if [the Commission] makes a bad decision.”
Arnott noted before the vote that if the Commission voted to remove the county from the MPR plan, they would not be able to rejoin for two years.
“So if [UHC] fails, you’re not going to have the ability to back to MPR, which is the only one that gave you a reasonable rate out of the ones that were already bid out,” Arnott said.
Arnott asked Commissioner Dixon if the Commission could make the same promise MPR did that rates would not go up, meaning that the elected officials didn’t have to pass increases on to employees or take it out of their budgets.
“I don’t have an answer,” Dixon responded.
Arnott’s action removes about half of the county employees that were under the previous plan.
Other County Elected Officials Concerned
While Sheriff Arnott was the only county elected official to openly announce a withdrawal, other officials expressed concern.
Prosecutor Patterson, who told OI that he was not ready to pull his department yet but “will be weighing the options,” expressed misgivings about the new plan in the Tuesday afternoon conference call.
“There has not been a ton of analysis,” Patterson noted.
County Auditor Cindy Stein stated during the discussion that she was not in favor of the plan that was approved by Dixon and Russell.
“I’ve had concerns about the costs from the beginning and I haven’t seen anything that has changed my mind on that,” Stein said in the meeting.
County Clerk Shane Schoeller expressed his concern during the meeting several times that division among the office holders and Commission will weaken the county’s overall position.
Schoeller also noted the number of times that county office holders worked together, sacrificing parts of their budgets to help other office holders, and how that collaboration has been to the benefit of the whole of Greene County.