Another $2.2 million available for county employee insurance fund

Wilson County government has another $2.2 million set to roll into its self-funded employee health insurance plan by the end of the fiscal year next week, a fact that came as a surprise to some county commissioners who considered raising county employees' co-payments Monday.
The news has some commissioners asking if the money could not be used for other needs in county government during a tight budget year.
Commissioners were told at their monthly meeting by Financial Management Committee member Billy Swindell the fund had only $1.5 million, a figure County Finance Director Ron Gilbert said was technically correct.
The other $2.2 million rests in a "liability account," Gilbert said, adding that the money is already earmarked for the county employee health insurance fund. The liability account money brings funding available for the health insurance plan up to $3.7 million.
"It's already been obligated and charged out from the departments' budgets," Gilbert said in his office Tuesday of the $2.2 million. "It has not and could not be used for anything else."
Gilbert said that money is part of the $3.9 million total earmarked in the county budget for fiscal year 2003-04 for the county employee health insurance plan.
According to public records in the County Finance Office, the county's self insured plan began fiscal year 2003-04 – which ends June 30 – with a fund balance in the health insurance plan of $3.7 million.
In addition to the extra $3.9 million budgeted for the plan through individual county department budgets, another $460,000 will be paid into the fund from employees paying dependent coverage and interest on the fund itself.
Altogether, the insurance plan funding this year crests $8 million. According to figures from Gilbert's office, the county will pay out around $4.3 million in claims and expenses for the fiscal year if projections for this month hold true.
Wilson County Finance Committee Chairman Rusty Thompson said Tuesday he was aware of the $2.2 million liability account, but he did not contradict Swindell's numbers in the Monday meeting.
"I may have misspoken or been misquoted," Thompson said. "I probably misspoke. … I'm not sure I got the right figure under the right column."
However, Swindell said he was not aware of the figures, though he was eager to learn more.
"I wasn't aware of that," Swindell said Tuesday night. "I didn't know that existed. I knew there was a balance in the existing fund. But … I'm not aware of (the liability account), but certainly would like to be aware of it."
At the same time, Thompson said some moves need to be made by commissioners to ensure the employee health insurance plan remains solvent.
He noted the plan's cost increased with claims almost $1.1 million from last fiscal year to the current year.
"The concern of the Insurance Committee is that we have a very, very disturbing trend," Thompson said.
While Gilbert said the current health insurance fund balance could not be used for any other purpose, he did concede commissioners could choose in the coming 2004-05 budget to pay less into the fund.
Based on the average monthly claims and expenses, a bare minimum according to Gilbert to have in the fund would be about $2.1 million, or six months worth of claims.
Such a move could free up about $1.6 million in the budget for 2004-05, something Gilbert and Thompson both cautioned against.
"That would be a real low figure," Gilbert said. "In my opinion, 12 months worth is the right figure.
"We went through some very tough times in the last four or five years on insurance," Thompson said. " … I would be opposed to that. That would be very, very poor financial management."
However, commissioners reached Monday were both surprised by the new information concerning the extra $2.2 million and ready to consider alternative uses for the fund balance.
"That is something they need to question," District 22 Commissioner Heather Scott said. "I would say, let's put that money to better use."
District 20 Commissioner Annette Stafford said an independent audit of the insurance fund is probably needed.
"I don't think that large reserves should be kept," Stafford said. "I've felt like a lot of the numbers have been stacked. This is proof."
Staff Writer J.K. Devine contributed to this story.
Managing Editor Clint Brewer can be reached at 444-3952 ext. 13 or by e-mail at cbrewer@lebanondemocrat.com.