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Lewis County adopts $3 million health plan fund-balance policy to buffer premiums
Summary
The Lewis County Legislature voted to adopt a formal health plan fund-balance policy that sets a $3 million minimum reserve and gives a steering committee authority to recommend adjustments; the measure passed after discussion about current reserves, recent hospital support and an expected New York State payment.
The Lewis County Legislature on June 17 adopted a health plan fund-balance policy that sets a recommended minimum reserve of $3,000,000 for the county's employee health insurance fund and gives a steering committee authority to review and recommend adjustments to the level twice a year.
County staff presented the draft policy before the vote. "Minimum fund balance amount, our recommendation is $3,000,000," the presenter, identified in the meeting as Eric (Staff member), told legislators as he walked through calculations and assumptions behind the recommendation.
The policy directs a steering committee made up of county administration, hospital administration and consultants (GKG) to formally review the fund balance twice a year and permit the committee to recommend revisions to the minimum reserve. The presentation explained how actuarial inputs and short-term claim lags informed the target. Milliman, the county's actuarial firm, provides the county's incurred-but-not-reported (IBNR) and premium estimates used in the calculations.
Officials described the rationale for a $3 million target. Annual plan claims in 2024 were about $16,000,000, two months of claims were estimated at roughly $2,500,000, and other reserve calculations ranged from about $930,000 (recommended) to $1,200,000 (conservative) under Milliman's measures. The presenter said the county chose a conservative approach: "At $3,000,000, we're conservative in both cases," referencing both claims-based and actuarial reserve methods.
Legislators asked how often the balance would be reviewed and whether the twice-yearly formal review is sufficient. Eric said the formal review would be twice a year but that the steering group discusses fund balance on a more frequent basis, "every 2 to 3 months at a minimum." He also explained how the policy ties reserve shortfalls to premium-setting: if the fund is below the minimum, the policy calls for adding 5 percentage points to the actuarially suggested mid-range premium increase during annual renewal discussions.
The presentation included the county's current reserve position and expected near-term inflows. Eric said the county currently has about $650,000 in the health fund and that the hospital provided $2,100,000 in December. He also said the county expects a roughly $2,000,000 payment from New York State tied to shared services through the Broome County Purchasing Alliance and that the county's earlier guidance would route that money to the reserve.
Legislators clarified budget mechanics. Eric said the reserve is part of the health fund balance (cash and investments) rather than a separate direct line in the county operating budget; employer premium contributions (the county pays 75% of premium-equivalent costs) are budgeted as ongoing personnel/employer costs.
After discussion, the Legislature voted to adopt the health plan fund-balance policy. The motion was recorded as carried; two legislators were recorded opposing the measure by name during the roll call.
The policy directs the steering committee to monitor the fund balance and gives it the ability, with notice to the Legislature, to revise the recommended minimum. It also sets conservative default premium-guidance steps: add 5 percentage points to the mid-range actuarial increase if below the minimum, use the actuarial aggressive increase if reserves exceed the minimum by 50% or more, and otherwise consider a standard annual increase (the draft cites 3.5% as a baseline).
Legislators and staff said they expect to revisit specifics if the steering committee proposes changes and to provide the Legislature notice when the committee makes formal recommendations.
Votes and next steps: the adopted policy will be posted with the county's legislative materials and implemented through the steering committee and benefits-administration processes. The Legislature was told staff will present calculations and any proposed rate changes during annual premium renewal discussions and at formal steering-committee reviews.
