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Franklin County adopts new 2026 health plan design with HRA after commissioners vote
Summary
After a detailed presentation on rising medical costs and prescription rebates, commissioners voted to adopt a redesigned 2026 benefits package that uses a health reimbursement arrangement (HRA) paired with higher-deductible base plans to reduce the county's net premium increase.
Matt Henderson, benefits consultant, presented the county's 2026 benefits renewal options during the Oct. 8 commissioners meeting and the board voted to adopt a revised plan structure intended to curb a proposed double-digit premium increase.
Henderson said the county faced a Premera renewal that initially approached about a 23% increase after negotiations. He proposed moving most enrollees onto a $3,500 medical plan and pairing it with a health reimbursement arrangement (HRA) that would reimburse the portion of the deductible above $1,000, effectively preserving employees' existing net deductible exposure while lowering the insurer's premium increase. Henderson said the county would budget HRA contributions of roughly $282,000 for the plan year and that the combined effect of the HRA and the new base plan structure would lower the blended increase compared with renewing the current plan designs unchanged.
Why it matters: County employers and employees face substantial medical inflation. The HRA structure the board approved is designed to reduce premium increases while keeping employee out-of-pocket exposure similar to current plans. Commissioners said they also want to explore larger pooling and eventual self-insurance as longer-term steps.
Henderson laid out plan-cost modeling showing that, under the HRA option, the county's blended net increase for medical and dental would be materially smaller than the raw insurer renewal. He also described the county's current paid-claims picture: a paid-claims ratio exceeding 100% and unusually large pharmacy spend; he explained that pharmacy-manufacturer rebates exist but are not visible on typical gross paid-claims reports and that those rebates can be retained by the insurer unless the county moves to a self-insured arrangement.
After discussion in the benefits committee and the board chambers, a motion to adopt the option that implements the HRA-backed structure (identified in committee as "Option 2") passed unanimously. The board instructed staff to proceed with open enrollment under the adopted design, continue outreach to other pooling options that were presented to the county, and explore steps toward potential self-insurance in the future.
Ending: Commissioners asked the administration to pursue any potential near-term cost savings from larger pooling opportunities and requested periodic updates on enrollment, HRA reserve build-up, and development of a longer-term self-insurance plan.
