Wednesday, April 2, 2014
Out-of-Pocket Health Care Costs to Rise for County Employees
Yesterday's County Manager-County Board FY 2015 Budget Work Session included budget items related to compensation of County employees. The average pay of County employees will rise about 2.7 percent in FY 15. But except for the healthiest persons in the County's workforce out of pocket health care costs for County employees will also rise, sometimes significantly, this year.
County Manager Barbara Donnellan will soon decide whether the County will either raise employees' co-payments or go to a 90-10 co-insurance system, where the employee pays 10% of total medical costs, whether office visits or in-hospital medical costs. In the long term the County will implement a 90-10 co-insurance system possibly followed by a health savings accounts system with high deductibles.
Donnellan wants the County to avoid paying the Federal so-called 'Cadillac tax' on so-called 'luxury' healthcare plans, which the County will start paying in 2019, when the cost of healthcare per employee exceeds $27,500. The County has two major health insurance providers, CIGNA and Kaiser Permanente. According to information presented by Human Resources the County's healthcare costs will significantly increase over the next decade, averaging about 7% per year.
There was much discussion by the County Board and County HR Staff about employees incurring large out-of-pocket expenses because of large hospital bills, but nothing was decided about remedies. Donnellan will make a decision about co-pay increases vs. co-insurance for the next fiscal year sometime before employees' open season begins next. month.
There was no discussion whatsoever about the growth of healthcare spending related to the overall growth of Arlington Government spending.