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NAO tells county health plan faces higher premiums after claims spike; board weighs HSA and plan-design options
Summary
Nebraska Association of County Officials presented a renewal analysis showing Lincoln County's claims pushed it up two tiers, producing an estimated 14.65% base increase and a move from tier 9 to tier 11 driven by 18 large claims totaling about $3 million; options discussed included HSA uptake, raising the HSA-eligible deductible to meet IRS rules and targeted outreach to Medicare‑eligible employees.
Representatives from the Nebraska Association of County Officials told Lincoln County commissioners that a spike in large claims required moving the county’s group health plan two tiers under NAO’s tiered renewal structure, producing a significant rate change at renewal.
"Lincoln County is not running real well and hasn't for the last two renewal periods," said Mike Bowden of the Nebraska Association of County Officials. Bowden told the board the previous 12-month loss ratio was roughly 103% and the current 12-month loss ratio was approximately 304%, and that 18 large claims (each counted at $50,000 or above) in the last year equated to about $3 million in claims that heavily influenced renewal pricing.
Bowden and NAO staff outlined options to moderate future cost growth: encourage greater enrollment in the county's HSA/high-deductible plan, revisit the cash‑out stipend for employees who waive county coverage (including a proposal to make the stipend a percentage of single coverage rather than a flat amount), and target Medicare‑eligible members for counseling about supplemental coverage. Commissioners heard that NAO had engaged Medicare-transition counselors to meet with eligible employees and that those meetings were proceeding.
Bowden also said the county needed to adjust the buy‑down on its high-deductible health plan to remain compliant with IRS high‑deductible health plan rules: the county's current employee deductible buy‑down left the plan short of the IRS threshold and should be raised (the presenter used 3,400 as the IRS reference point in the discussion). Staff noted that changes could be handled as part of the renewal application and that open-enrollment outreach would follow.
Commissioners asked for follow-up on subgroup application deadlines and employee education; no final board action was taken at the presentation—the item was informational and scheduled for benefit‑committee follow-up and possible action at the next meeting cycle.
The presentation emphasized that the county has implemented methods that helped (HSA option and deductible buy‑down) but that actuarial cycles and large claims can push renewal rates upward despite plan management steps.
