PARKERSBURG – Wood County commissioners voted Monday to stay with Highmark Blue Cross and Blue Shield for health insurance coverage of employees.
The new policy begins July 1 and will mean an 18 percent increase in the costs and changes in coverage. The commissioners budgeted for a 20 percent increase in the county’s 2015-2016 budget.
One of the program changes involves managed prescription drug coverage. The change applies only to new or different prescriptions, officials said.
Originally Highmark proposed a larger increase, but agreed to a 3 percent reduction if the county consented to proposed changes in its coverage. The county also received proposals from Aetna and The Health Plan this year.
The county averages 198 employees with 413 health insurance participants, including dependents covered under the county policy.
Highmark Blue Cross and Blue Shield’s quote included taxes and fees imposed under the federal Health Care Reform Act, including $120,000 for the uninsured payment pool, which is one of the new federal requirements.
Additional increases are anticipated over the next few years, including from the so-called Cadillac Tax, which will take effect in 2018, county officials were told earlier.
According to a report provided by Mark Schwendeman, an insurance consultant under contract with the county since 2007, claims records accounted for much of the renewal increase, with incurred claims in excess of $2.3 million compared to $2.5 million in premiums.
“The rates are dictated by the claims experience which has been considerably higher over the past few years. The loss ratio on incurred claims ending in March was $3,260,075 compared to the original 12-month period of $2.3 million. You had 18 claimants with large claims, each with over $25,000 in claims. Those 18 individuals accounted for 53.7 percent of the incurred claims, or $1,236,518,” Schwendeman told the commissioners during a meeting last week.
“We are also seeing a significant trend upward principally because of what are called specialty drugs, which are patented,” Schwendeman said of insurance costs.
Officials said those using specialty drugs would be grandfathered and the change will only apply to new or changed prescriptions.
Employee contributions for health insurance are $5 per pay for single coverage and $115.68 for family coverage.
The options proposed to the commissioners from the three insurance firms ranged from annual premiums of $2.5 million to more than $3 million.
Date: May 19, 2015