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<br /> million and $2.8 million. A target of approximately two (2) times the IBNR, or $1.85 million, is
<br /> recommended to stabilize the fund.
<br /> The County's current fund ratio is —1.3% as of December 2025 indicating that reserves are below
<br /> the target. Increasing premium equivalent rates to cover actual claims incurred will provide the
<br /> opportunity to help build reserves in the future.
<br /> Financial Review
<br /> The following table details the County's claims experience from FY20 through FY25.
<br /> FY20 FY21 FY22 FY23 FY24 FY25
<br /> Jul 19-Jun 20 Jul 20-Jun 21 Jul 21-Jun 22 Jul 22-Jun 23 Jul 23-Jun 24 Jul 24-Jun 25 YoY Change
<br /> Med$ $6,895,698 $8,857,216 $10,946,908 $8,883,956 $9,921,942 $10,689,943 8%
<br /> Rx$ $3,611,785 $3,362,195 $3,666,862 $4,257,610 $5,138,699 $7,173,975 40%
<br /> Total$ $10,507,483 $12,219,410 $14,613,770 $13,141,565 $15,060,642 $17,863,919 19%
<br /> Average Employees Covered 1078 1050 1024 1064 1111 1127
<br /> Avg Per Claimant Per Year $9,743 $11,635 $14,278 $12,349 $13,558 $15,846
<br /> Banded Layer$>40K $1,740,760 $2,701,986 $27,772,535 $2,547,489 $3,140,986 $4,150,593
<br /> Banded Layer Claimants>40K 45 57 53 73 74 88
<br /> Stop Loss Reimbursements $647,818 $549,098 $2,165,540 $483,352 $611,414 $767,884
<br /> Stop Loss Claimants 2 1 4 1 8 2 1 2 11'
<br /> #of Claimants over$10K 221 262 266 296 357 414
<br /> #of Claimants over$20K 111 130 139 149 182 208
<br /> *ISL increased from$200K to$400 K
<br /> From FY 2020 through FY 2025, the Health Insurance plan has experienced increases in the
<br /> frequency and severity of large claimants, overall increases in gross claims, and growth in plan
<br /> enrollment.
<br /> From FY 2024 to FY 2025, the cost of total claims increased by$2,803,277 or approximately 19%.
<br /> Of that increase, medical claims increased by $768,001 or approximately 8%, while pharmacy
<br /> claims increased by over $2 million or 40%.
<br /> Cost of Claims
<br /> Actuarial analysis from NCHIP recommends a 12.5% rate increase to both the employee and
<br /> employer share of premium equivalents to meet the cost of expected claims. If the County absorbs
<br /> the entire cost of this increase and does not increase employee contributions, the County's cost
<br /> would need to increase by a total of 13.7%.
<br /> Pharmacy Cost Drivers
<br /> One of the primary cost drivers for pharmacy claims is the increased use and high relative cost
<br /> of GLP-1 drugs for weight loss.
<br /> o Approximately 100 members are using GLP-1's for weight loss.
<br /> o The cost of covering these medications for weight loss is approximately $1 million.
<br /> o Other employers that have continued to cover the GIP-1's have also needed a
<br /> "catch up" increase as employers did not anticipate the demand associated with
<br /> these drugs.
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