Fresno County supervisors must spend millions more to make their employees whole by sharing in the costs of their health insurance plans, but that cost ultimately will end up being paid by both taxpayers and the county’s workforce.
Employees have overused their health insurance plans with higher-than-normal trips to emergency rooms. Their premiums have risen as their wages were increasing. The supervisors last year supported returning 9 percent in wages that workers lost in 2011 because of budget cuts. But the raises are being gobbled up by higher insurance premiums.
The problem could cost the county millions to solve as employees already pay large chunks of their earnings for employer health insurance coverage.
Supervisors discussed the problem Tuesday and will return next week to take action on higher premiums and possibly add two new plans to put costs in check. The new premiums go into effect in December.
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“All options are on the table,” said Paul Nerland, the county’s human resources director. “We want to look at our cost drivers where there are preventable costs” and reduce them.
Fresno County partners with Tulare County and other agencies in the San Joaquin Valley Insurance Authority. Premiums for authority members totaled $109.8 million in 2016. Beginning Jan.1, premium projections are 17.7 percent higher, or about $129.2 million. The authority covers about two dozen agencies, but Fresno County is by far the largest with 5,550 employees enrolled. Tulare County is second largest with about half that number.
“The supervisors are concerned about the numbers they are seeing,” said Jean Rousseau, Fresno County administrative officer.
To cover those costs, the county has to raise employee premiums by 11.7 percent to 16 percent, depending upon the plan. The bulk of the money would likely come from employees unless higher county contributions are put into place. Fresno County is at, or near, the bottom with employee contributions compared with other local agencies.
The supervisors are concerned about the numbers they are seeing.
Jean Rousseau, county administrative officer
When insurance rates are higher, Rousseau said, the employees suffer and the county becomes less competitive in attracting top candidates.
“It makes it hard to recruit and we’re losing some top people to neighboring counties,” he said. “To build a good organization, you need good people, and to have good people you have to have good benefits and salaries.”
A major issue, he said, is the number of people going to emergency rooms for treatment, the most costly level of care.
The county will try to educate employees to dissuade them from going to emergency rooms in favor of urgent care, 24-hour health lines and online health options or building a health clinic for county employees in areas where they work in high concentrations, officials said.
Anthem, which covers the bulk of county employees, identified about $822,300 in savings had employees gone to urgent care facilities instead of the emergency room last year. Urgent care prices are a fraction of emergency room visits, Nerland said.
Also, there were 50 specialty medications that accounted for 34 percent of overall drug costs, and the top 25 of all employees enrolled accounted for 1 percent of total claims and 22 percent of drug spending, according to county documents.
Under most plans, employee-only rates will rise about $100 per month. The bulk of those with families on their insurance plans will pay an additional $235 per month.
The bulk of employees with employee-only plans will pay about $740 to $770 per month. For employee and family, the rates will rise to between $1,700 and $1,800 per month.
The county’s contribution to employees is $233 for employee-only plans and $333 for those with families, according to county documents. Fresno County ranks near the bottom in contributions to employees’ health insurance. This year, the county raised its contribution $10 per employee.
Supervisor Andreas Borgeas said he had the most expensive plan for himself and his family, which costs about $2,500 a month.
To have to pay that much is “unconscionable,” he said. “It’s unacceptable.”
I beg you to do something about these increases. Don’t put that additional tax on employees. That’s what it is, it’s a tax.
Doug Godinho, business representative, International Union of Operating Engineers Local 39
Ways to save
Union officials are suggesting changes that could save money, such as the on-site clinic, an improved wellness program and a diabetes management program since 16 percent of employees listed it as a chronic condition.
County and union officials say the top concerns are: asthma; obesity; high blood pressure; access to healthy food; cholesterol and diabetes. Other issues cited were lower back problems, digestive issues, stress, anxiety and depression.
Riley Talford, president of Service Employees International Union, Local 521, said fewer members are covering their families because of costs. He offered stories of members who are unable to afford insurance for their loved ones.
“When workers can’t afford basic health care, those (county) services suffer,” he said. “Lower employee contributions put health care out of reach for Fresno County workers.”
Talford said he pays more than $560 per pay period and lost two doctors who wouldn’t take his coverage. He said an on-site clinic would reduce the amount of time employees are away from work and save money. He also said the county should pay higher contributions to employees.
Doug Godinho, business representative for the International Union of Operating Engineers Local 39, said “a mass exodus” will occur if new rates are approved without greater financial contributions from the county.
“They can pretty much go where they want,” Godinho said of the workers he represents. “I beg you to do something about these increases. Don’t put that additional tax on employees. That’s what it is, it’s a tax… there’s no way these employees can absorb this kind of cost.”
▪ In other action, supervisors approved buying 4.5 acres of land at Kings Canyon Road and Temperance Avenue that had been used by the California Department of Transportation during construction of Highway 180. The cost of the land was $150,000 and $5,000 for additional, related costs. No specific purpose for the property has been determined.