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18 <br /> 1 Chair Hamilton requested that training be made mandatory rather than encouraged and <br /> 2 asked to receive training information to determine formal policy requirements. She asked what <br /> 3 changes to the procedures are being made. <br /> 4 Chad Phillips explained that the changes primarily involve commercial property <br /> 5 representation rules and scheduling time allocations. <br /> 6 <br /> 7 5. Public Hearings <br /> 8 None. <br /> 9 <br /> 10 6. Regular Agenda <br /> 11 a. Approval of Employee Health and Dental Insurance Renewal and Continued <br /> 12 Participation in the North Carolina Health Insurance Pool <br /> 13 The Board approved employee health and dental insurance premium equivalent rates for the plan <br /> 14 year July 1, 2026, through June 30, 2027, and approved continued participation in the North <br /> 15 Carolina Health Insurance Pool (NCHIP). <br /> 16 <br /> 17 BACKGROUND: The County provides health and dental benefit plans for employees and their <br /> 18 families, as well as health benefit plans for pre-65 retirees. The Board of Commissioners has the <br /> 19 responsibility to approve the health and dental insurance rates each fiscal year. This approval is <br /> 20 made in advance of the annual budget so staff can hold an open enrollment period prior to the <br /> 21 beginning of the fiscal year, July 1. Open enrollment is scheduled for the period of April 27, 2026, <br /> 22 through May 10, 2026. <br /> 23 <br /> 24 Health Insurance <br /> 25 In FY 2019, the Board of County Commissioners approved Orange County's participation in the <br /> 26 North Carolina Health Insurance Pool. Based on stable claims experience, from FY 2019 through <br /> 27 FY 2022, the County maintained no increases in premium equivalent rates for health insurance <br /> 28 and dental coverage for employees and pre-65 retirees. <br /> 29 <br /> 30 In subsequent years, the Board approved 5% increases in premium equivalent rates for health <br /> 31 insurance coverage each year through FY 2025 and a 6% increase in FY 2026. The County has <br /> 32 absorbed the cost of these increases and has not increased the employee contribution to the <br /> 33 health plan for active employees or pre-65 retirees since 2015. <br /> 34 <br /> 35 Funding for the health plan is based on estimated premium equivalent rates that are calculated <br /> 36 to pay for incurred claims, administrative and reinsurance costs, and expected liability of claims <br /> 37 Incurred but Not Reported (IBNR). The plan also carries a reserve balance which helps to ensure <br /> 38 the County's ability to pay any claims that exceed the budgeted amount in any given year. <br /> 39 <br /> 40 Best practice recommends maintaining reserves between 1.5 and 3.0 times IBNR. Based on the <br /> 41 December 2025 IBNR liability of $922,644, the recommended reserve range is between $1.4 <br /> 42 million and $2.8 million. A target of approximately two (2) times the IBNR, or $1.85 million, is <br /> 43 recommended to stabilize the fund. <br /> 44 <br /> 45 The County's current fund ratio is—1.3% as of December 2025 indicating that reserves are below <br /> 46 the target. Increasing premium equivalent rates to cover actual claims incurred will provide the <br /> 47 opportunity to help build reserves in the future. <br /> 48 <br /> 49 <br />