Beaufort County staff recommend new retiree health reimbursement plan starting July 2026

Beaufort County staff recommended adopting a retiree health insurance reimbursement arrangement that would offer a monthly stipend to pre‑65 retirees who secured private coverage, with the program proposed to begin July 1, 2026.

The program would be a defined contribution: retirees would purchase their own health insurance through the marketplace or another private insurer and submit proof to a third‑party administrator to receive a monthly reimbursement. "This is a defined contribution, a monthly stipen to reimburse members for health insurance where these retirees would go obtain their own health insurance through the marketplace and we would provide a reimbursement stipen for them through a third‑party administrator," benefits staff said during the March 10 workshop.

Why it matters: the model limits the county’s exposure to medical inflation and the costs of a self‑insured retiree plan, staff said. Presenters described the county’s prior retiree program (established in 2004, modified in 2008 and ended in 2016) as costly and a factor in an adverse effect on the county’s credit rating at the time.

Eligibility and stipend tiers: staff proposed eligibility for pre‑65 retirees who are PEBA‑retirement‑eligible and who had at least 15 years of continuous service with the county at retirement. The recommended stipend tiers are $300 a month (15.00–20.99 years of service), $400 a month (21.00–27.99 years) and $500 a month (28+ years). An administrative fee (about $3.50 per retiree per month) was also noted.

Projected participation and budgeting: using retiree data back to 2015, staff reported an average of about 12 new eligible retirees per year and an average retirement age of 57. From those figures staff forecast a steady‑state population of about 96 participants and estimated first‑year costs under a conservative participation scenario at roughly $58,000; a higher first‑year participation assumption (18 retirees) produced a year‑one cost estimate of roughly $108,000. Staff recommended budgeting a larger first‑year amount to allow for higher initial take‑up.

Council questions and clarifications: council members asked how spousal or employer‑provided coverage would affect eligibility. Benefits staff replied that an individual would not be eligible for the stipend if they chose to remain covered on a spouse’s or an employer‑provided plan and must show proof of private market coverage to qualify. "You would be eligible for it, but if you decide to go on your spouse's plan, you are not," the presenter said.

Next steps: staff said they would include the recommended costs in the upcoming budget materials and return with policy language for council consideration. The proposal is prospective (starting July 1, 2026) and staff noted that future councils could alter or discontinue the program.

Ending: the workshop discussion concluded with council members suggesting the stipend be tied to annual appropriations so future councils would review the amount during the budget process rather than binding subsequent councils to an automatic increase.