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Strafford County braces for higher health-insurance and retirement costs in 2025 budget
Summary
Officials told commissioners projected health-insurance premiums and retirement contributions are pushing up the 2025 budget; the county negotiated credits and is moving some retirees to Medicare Advantage, though that plan also saw a recent 55% premium increase.
County administrators warned commissioners that employee-benefit costs are a significant upward pressure on the 2025 budget, driven by higher health-insurance premiums, changes in the county’s employee census and retirement-system contribution rates.
Staff said health-insurance cost growth started at an 18% projection but was negotiated down to around 10% for budgeting purposes; that change still represents roughly $2.4 million of budget impact in the draft. To lower costs, the county is moving about 18 Medicare-eligible retirees from the county plan to Medicare Advantage, a shift staff said will save the county on premiums, though staff also noted a recent 55% increase in Medicare Advantage premiums for the county at one carrier.
Officials discussed benefit design tools they use to control costs: an HRA to offset deductible exposure, targeted credits from Anthem (a $300,000 credit this year compared with a $175,000 credit the prior year) and a waiver/stipend for employees who decline coverage. Legal counsel cautions that waivers carry litigation risk if not administered properly, and staff said counties face constraints under federal law and the Affordable Care Act.
Staff reviewed other insurance lines: workers’ compensation increased modestly (from about $727,000 to $771,000 in one cited figure), and dental premiums rose slightly after several flat years. The meeting also reviewed New Hampshire retirement-system contribution changes that slightly reduce employer rates for some groups in mid-2025 but stressed the system remains underfunded at the state level.
Next steps: staff will continue union negotiations about employee contributions, monitor carrier credits, and plan communications about HRA design and benefit options that can help mitigate next year’s premium increases.
