This is the time of year many people make New Year’s resolutions, especially to live a healthier life in the coming year.
About six years ago, Pima County made a Fiscal (New) Year’s resolution to take control of its annual health care costs by creating a self-insurance fund and vigorously promoting the health and wellness of its employees.
I’m pleased to say our resolution has been a huge success so far. Our employees are healthier, our annual health care costs are manageable and predictable, and county taxpayers have been saved from having to pay for tens of millions of dollars in health care related costs.
In the two fiscal years before the county switched to self-insurance, the county its employees and, ultimately, the taxpayer had to pay 18 and 19 percent increases in annual premiums.
This followed about a decade or more of double-digit health care cost increases.
In an effort to keep annual costs down, the county repeatedly shopped for other insurance carriers and frequently switched.
This was a major disruption to employees and their families who had to check to make sure family doctors and specialists were participants in the new plans.
With self-insurance, annual costs increases have been single digit and our plan administrator has remained the same, Aetna. By switching to self-insurance and refusing to play the rate-increase game, the county has avoided as much as $44 million in premium costs over the past three years. If the county had incurred those costs, it would have had to either cut the budget elsewhere to pay for them or raised taxes.
There was some risk associated with self-insurance because insurance is all about risk.
Major health insurers spread risk over hundreds of thousands of ratepayers. For the county, the risk would be on county employees and taxpayers, so it was important the plan was well funded and well managed.
A recent audit of the self-insurance trust fund shows the fund is doing better than expected and by the end of this fiscal year should have more than a $14 million balance.
To further keep health care costs down, the county has dozens of health and wellness incentives and programs for employees.
Employees who participate in annual health screenings, who don’t smoke or quit and who earn healthy lifestyle activity points can earn discounts on their insurance premiums.
We offer gym discounts, fitness classes, nutritional counseling, health coaching and tobacco cessation counseling. The results have been impressive. Roughly 7 out of 10 employees participate in at least one wellness program or incentive each year.
Healthy employees are happier, more productive, have fewer days lost to illness, and use fewer health care benefits, all of which saves them, the county and the taxpayer money.
If you’re making a resolution this New Year, I hope it is as successful as ours has been for our employees and taxpayers.
May 2016 be a very happy new year for you, your family and for all of Pima County.