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Woodbury County officials warn of $250K–$1.5M health-fund shortfall; consultants propose midpoint plan
Summary
County staff and Gallagher consultant Seth outlined scenarios showing the county health-care fund could be underfunded by $250,000 to as much as $1.5 million next year; staff presented options including a midpoint plan, a four-tier enrollment structure and possible premium or contribution changes before Dec. 10 open enrollment.
Chair called the health-care discussion informational and asked staff and consultants to present options ahead of open enrollment, which closes Dec. 10. Ryan (county staff) told the board the county contributed about $6.5 million to the healthcare fund in FY25 and employees paid about $578,000 in premiums; total claims paid were roughly $8.7 million and pharmacy rebates were about $1 million.
"On an average month, the healthcare fund went down by $100,000," Ryan said, and presented modeled shortfalls ranging from $250,000 (conservative estimate) to $1,500,000 in a worst-case scenario if claims and fixed costs track high. He noted fixed monthly costs that include administration, pharmacy and stop-loss premiums had increased and could push the monthly fixed cost toward $140,000.
Seth, a Gallagher consultant, said Wellmark/Walmart timeline delays constrained how quickly the county could finalize options. He proposed a midpoint alternative that cuts roughly half the previously proposed change and described a move from a two-tier to a four-tier enrollment (single, employee+spouse, employee+child(ren), family) to better align employee cost-sharing with national benchmarks.
Seth cautioned that an HSA would require raising the minimum deductible to about $1,700 from the county’s current $750 out-of-pocket threshold, which he judged unlikely to be widely accepted by employees: "I do think it's something to look at. However, I'm going to guess that nobody would probably go from a $750 deductible over to a $1,700 deductible." He estimated a midpoint design could reduce the shortfall by roughly $500,000–$537,000 versus the larger prior proposal.
Board members asked for more granular modeling of dependent-premium changes and the financial impact of moving from two tiers to four tiers; Seth and Ryan committed to return with detailed numbers within the week. Ryan recommended departments budget health-benefit costs into each office’s allocations rather than covering shortfalls from the general supplemental fund.
The board did not take action; members framed the discussion as information to shape potential decisions before open enrollment.
