Agenda - 04-07-2011 - 3 - Laserfiche WebLink

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2 Health Insurance Currently the County pays approximately $6.6 million for health insurance across all funds for employees ($5.5 million for the General Fund) each fiscal year. Additionally, the County pays approximately $1.4 million per year for all retiree health insurance related costs. For the upcoming budget year, the North Carolina Association of County Commissioners has informed us that they will no longer administer our health insurance plan as of December 31, 2011. Additionally, Mark III Benefits has informed us that we can expect up to a 25% increase in health insurance for employees and retirees for the calendar year ending December 31, 2012. We estimate the increase and the affect on the FY2011-12 budget to be as follows: • Employee health insurance • Retiree health insurance • Tota I $1.2 million .5 million $1.7 million Additionally, we anticipate based on past experience that our health insurance costs will increase by 15 to 20 percent per year as a result of claims paid in previous fiscal years. Annually, this would represent an increase of $1.1 million to $1.5 million per year in health insurance for current employees and retirees. We would recommend the Board of County Commissioners explore other options of funding the county's health insurance benefits to control the increasing insurance costs of the employees and retirees such as: • Self Insurance-The County pays all health insurance claims. • 80120 Plan -The County pays 80 percent of the costs of insurance and the employee pays 20 percent of their insurance. • 70130 Plan -The County pays 70 percent of the costs of insurance and the employee pays 30 percent of their insurance. State Misdemeanant Expenses As part of the current year budget deliberations and development, the General Assembly has proposed moving the misdemeanants currently housed in state prisons to the County jails. This would have a material negative effect on our FY2011-12 budget. Currently the jail houses 147 prisoners, 70 of which are Federal prisoners, which we are reimbursed an estimated $1.8 million per year for housing. If the State's budget is passed with the housing of misdemeanants placed on the County Jail, we can expect the following impact: