Technically the contract hasn’t been awarded, the commissioners authorized County Administrator Charlie Young to negotiate with MMO. Young said when he started digging into the numbers he sort of put the brakes on, because the aggregate stop loss number was close to $28 million — the insurance carrier picks up the costs for anything over that amount — and it appeared the county needed to reconsider its self-insured status.
“When we finally got to that ultimate realization that’s why things really stopped and we began to look at and ask ourselves is this really the kind of risk we should be taking,” Young told the Journal-News.
He said both MMO and United Healthcare lowered the aggregate stop loss to around $23.5 million.
“Getting that risk mitigated, it’s $4 million less than when what it was when we first began the discussion, is the only reason we were able to go back and stay self-insured,” Young said.
Last year, the county went to a self-insurance model after several years of double-digit increases for insurance coverage. The prime mover behind the rate hikes were some large, once-in-a-lifetime claims over several years. There was a single $5 million claim in 2013 and a $3 million month in November 2014.
Last year the county had 19 claims top the stop-gap level — $175,000 for individual claims — compared to only two in 2016.
All things being nearly equal — the commissioners still must vote — Young said United Healthcare has a huge footprint in southern Ohio — MMO is headquartered in Cleveland — so he said they believe their employees would be more comfortable with that company.
MORE: Rate hikes may force a Butler County health insurance switch
The health insurance contract sparked uncharacteristic discord among the commissioners a couple weeks ago when a 2 to 1 vote in favor of MMO.
“I have never more strongly disagreed with the decision of this board of commissioners, nor any previous board of commissioners since I’ve been an elected official,” Commissioner Cindy Carpenter said after an executive session Oct. 15.
“I believe in my heart that this is completely the wrong decision to make.”
The county sought a new health insurance carrier after it was warned high claims could push premiums to more than 10 percent. Rate increases in requests for proposals from eight companies ranged from 31.5 percent to 14.3 percent — or $5.5 million to $2.5 million. The quote from the former provider Meritain was 24 percent.
The two top contenders were MMO, which tendered the lowest rate increase at 14.3 percent, and United Healthcare, which offered a 16.6 percent increase.