Swain County staff warn of rising health insurance costs and $900,000 deficit ahead of budget season

Interim County Manager Lottie Barker told the Swain County Board of Commissioners on Feb. 3 that the county’s health-insurance costs are increasing and that the insurance fund currently runs a roughly $900,000 deficit.

Barker said the county participates in a pooled plan administered by Gallagher (the North Carolina Health Insurance Pool), and the county will see an estimated 9% premium increase for the coming year — lower than broader market increases but likely to add between $200,000 and $250,000 to the county’s budget. She told commissioners she has not yet received final numbers and that department-by-department costings will be returned soon to inform budget decisions.

Why it matters: County officials said the deficit and higher premiums will be a central issue during the 2026 budget process, affecting whether the county absorbs costs or passes some increases to employees. Barker said the county’s prior move from a self-funded Blue Cross and Blue Shield arrangement to the pooled approach was intended to smooth large, irregular claims; staff reported weekly claim runs in recent periods near $200,000, which can drive short-term volatility.

Commissioners pressed for options, including seeking quotes from other carriers and the possibility of front-funding deficit payments to the pool. Barker cautioned that moving carriers can create provider-network problems in a rural area and that insurers typically review recent claims history when pricing new business. She also noted the pool sometimes grants claim forgiveness, which has reduced what the county would otherwise owe.

The manager said departmental budget worksheets will show how premiums and employee plan tiers translate into each department’s projected costs. Commissioners asked for the figures as soon as they are available so line-by-line budget review can proceed during the coming budget cycle.

What officials said (direct quotes): "We will be receiving a 9% increase this year," Barker said, adding she expected the increase to translate to "probably between 200 and 250,000 for the next budget year." Barker also described the existing insurance shortfall: "Right now, our health insurance, we are in the deficit $900,000."

Next steps: Barker said detailed per-department cost figures should be available "pretty soon," and commissioners scheduled more in-depth budget discussion to decide whether to absorb costs or adjust employee contributions. No formal budget decision was taken at the Feb. 3 work session.