Select board asks health insurance trust for three benchmarking options after budget task force flagged costs

At its meeting, the select board discussed the town's health insurance costs and asked the town's health insurance trust to prepare three benchmarking options to inform future negotiations and plan-design decisions, the board said.

The discussion followed a budget task force report that compared town departments to benchmark communities and flagged health insurance as an area for review to help balance the budget. A presenter said the report "made a whole series of recommendations for town leadership to look into with regards to making us more efficient," including a review of the town's health insurance strategy.

A presenter told the board the group saw two primary paths: "Obviously, staying with the health insurance trust, possibly making some plan design changes to match benchmark," or pursuing other options, but that alternative approaches appeared unlikely. The presenter said assumptions about employee profiles had caused the cost estimates to "change wildly," so the board asked for more precise modeling.

A staff member explained a technical reserve: "The trust fund should have the IBNR, which is the amount theoretically that if the plan ended, it would pay out all the remaining claims and expenses. But the IBNR is more of a historical look back at a point in time to look at see how quickly claims are submitted and processed," the staff member said.

Board members asked the health insurance trust to prepare scenario analyses that more closely align with subscriber profiles and to compare results against comparable communities. "We're asking the health insurance trust to look at what kinds of adjustments in the current structure of the plan could be made," the staff member said. "We want to see the health insurance trust come forward with potentially three options benchmarking us against our comparable communities," a presenter added.

Those present said the work would "fuel the next round of discussion," and emphasized that the board was not making a plan-structure decision at the meeting; any final terms will arise from later negotiations informed by the trust's analyses. The board reached consensus on requesting the three benchmarking options; there was no formal vote recorded.

The next procedural step is for the health insurance trust to present the requested options and modeling to the board for further consideration.