Get Full Government Meeting Transcripts, Videos, & Alerts Forever!
Get email alerts on the Employee Health Benefits topic
No spam. Unsubscribe anytime.
Commissioners approve $13.7 million transfer to cover higher-than-expected health plan costs for FY25
Summary
The Commissioners Court approved moving $13,666,906 from the employee health benefit fund reserve to pay remaining FY2025 health plan costs; staff estimated about $3.2 million will be reimbursed by stop-loss coverage and pharmacy rebates.
On Sept. 9 the Travis County Commissioners Court approved a transfer of $13,666,906 from the employee health benefit fund allocated reserve to pay expected remaining fiscal year 2025 health-plan expenditures. The motion passed unanimously.
Human Resources and Planning & Budget staff told the court the county expects partial reimbursement: an estimated $3,198,577 will return to the fund from stop‑loss insurance recoveries and pharmacy rebates. HR and benefits staff reported rising medical and pharmacy utilization in FY25, an increase in both the number of claims and the average cost per claim, and a larger count of catastrophic claims. Benefits staff cited a 12% increase in medical claim volume, an 8% increase in average medical claim cost, a 4% increase in prescription claim count and a 10% rise in average prescription cost compared with FY24.
Shannon Steel, HR Benefits Manager, and colleagues said the plan has seen a larger-than-expected number of very large claims (defined as claims exceeding $100,000) and several stop-loss claims over the $400,000 per-person specific deductible. HR estimated stop-loss reimbursements will rise as additional large claims are paid and closed; the stop-loss carrier’s current estimated reimbursable amount was discussed as part of the briefing.
County leaders acknowledged the transfer will reduce reserves and said the county will likely need to revisit plan rates for FY27. The Planning and Budget Office and HR committed to regular quarterly reporting, an improved dashboard for plan monitoring and a renewed procurement timeline for the pharmacy benefits manager (PBM) contract to seek more competitive pricing.
Why this matters: The approved transfer makes the plan solvent for FY25 but signals higher health-care inflation and utilization for county employees. Commissioners said they expect more frequent updates and that FY27 premium-setting may require larger rate increases or plan changes to preserve reserves.
