County staff recommends switching stop‑loss carrier after significant claims; estimated premium jump explained

Montgomery County staff recommended the commission approve a renewal of medical stop‑loss insurance with Tokyo Marine after a hard market produced only two competitive quotes and projected large claim exposure.

The recommendation: Melissa Peake, director of risk management, reintroduced benefits consultant Brent Cherry and said staff solicited the market but received only two competitive offers. Staff recommended the plan from Tokyo Marine, noting a projected roughly $230,000 increase in annual premium and that alternative lower-premium options would raise the county’s exposure to catastrophic claims.

Why it matters: Stop‑loss insurance reimburses the county for very large individual medical claims. Staff reported the plan includes a "no new laser" provision and a 50% rate-cap in the renewal, which they said would limit the carrier’s ability to impose higher rates for future high-dollar claims and thus reduce the county’s future exposure.

Discussion highlights: Commissioners asked whether the high exposures related to current employees, dependents or retirees; staff said the high-cost cases involved dependents and one retiree and that specialty drugs and extended hospital stays are the main drivers of large claims. Staff also reported the county has received roughly $1.4 million in stop‑loss reimbursements through July of the current plan year.

Outcome and next steps: Staff said the renewal and related increases were already budgeted and planned to be included on the formal agenda; no appropriation or final vote was recorded during the informational session.

Ending: Staff said they would continue to explore programs to contain long‑term exposure and would return with the formal renewal contract for commission approval.