Cherokee County staff propose benefit design changes to close $3 million health-cost gap

County management told the Cherokee County Board of Commissioners during the Aug. 19 work session that an actuarial forecast from the countys benefits consultant projects roughly $3 million in increased health-care costs for 2026 unless plan changes are adopted.

The lede: Jimmy Marcus, presenting results of a 2024 commercial survey and plan-cost projections, said the $3 million figure reflects forecasted claims and a planned 10% employee contribution increase. He said proposed plan-design changes could largely eliminate the projected county budget shortfall.

The nut graf: Management recommended a package of design changes intended to reduce plan richness and move employee contributions toward an 80/20 employer/employee split — a target county officials described as typical for similarly sized governments.

Marcus reviewed county benchmark metrics and said Cherokee Countys 2023 per-capita plan cost was about $18,518 and rose in the following year. He noted county employee contributions currently average roughly 16% of premium and said counties of comparable size tend to be at 20% or higher. To reach the 80/20 goal while avoiding a full $3 million budget increase, presenters proposed changes including raising individual and family deductibles, increasing out-of-pocket maximums, splitting pharmacy and medical deductibles, raising pharmacy mail-order copays, and increasing primary-care and specialist visit copays.

Specific proposed elements discussed included raising individual deductibles from $750 to $1,000 and family from $2,250 to $3,000; raising out-of-pocket maximums (examples given: individual from $2,000 to $3,000; family from $6,000 to $9,000); creating a separate pharmacy deductible and higher mail-order copays; and raising primary-care copays from $25 to $40 and specialist copays from $30 to $50. Presenters said a modeled combination of these changes plus a planned 10% employee share increase would bring the county to the targeted contribution split and eliminate the $3 million projected increase.

Commissioners asked whether the changes would take effect on a calendar-year basis, and staff said they would start in January (the calendar year) with partial-year savings reflected in the county fiscal-year budget. Board members also asked about other options and the potential budget impact if some items were omitted; staff answered that each element carries a modeled dollar value and omitting items would leave a residual budget deficit.

Ending: Managers said the proposed package will be returned to the board for a formal decision at a subsequent meeting, with staff noting the proposal is a recommended county-management plan change to avoid material budget increases.