There is no projected change in the county’s contribution for employee health insurance in the county’s 2014-15 proposed budget, which is still being deliberated.
While health benefits really have not come under the microscope at all during budget talks by the Board of Commissioners, — last year or this year — one commissioner during a recent budget session did mention the high cost of shouldering that coverage for employees, especially with the board seeking cuts in a plan that currently proposes a sizable tax increase.
“I’ve been saying the last several years that we might have to make some cuts. This might be the year we have to cut. The health insurance is a big cost. Sooner or later that is going to be cut … the employees are going to have to start paying some of it,” commissioner Jarvis McLamb remarked.
Commissioners in the past have pointed to the large cost of insurance, which amounts to $11,220 annually for each permanent employee.
A portion of the benefits package, notably insurance costs, are shouldered by employees in other counties. That is not the case in Sampson, where the county pays out $935 a month for each of its permanent employees. During 2012-13, the county paid $634 a month. That increased by nearly 50 percent, or $301 per month per employee, in the current year, a hike of $1.53 million just for health benefits.
The county paid the difference, with no commissioner last year even suggesting otherwise.
At that time, however, county manager Ed Causey said a more permanent solution will be crucial in the county’s sustainability. Without adjustments, he said, shouldering full insurance costs would drain county funds and leave department requests unfunded, employees without competitive pay and contribute to even deeper cuts down the line. That means making modifications to the county’s pay system, concerns over which have “reached catastrophic proportions,” he noted.
A pay and benefits study, commissioned earlier this year and currently in progress, is anticipated to make inroads toward finding a solution to what ails the county pay and benefits system.
In reply to McLamb’s suggestion, finance officer David Clack said the board would ultimately make the decision, but it would be best to see what comes out of that pay and benefits study first.
“That’s a decision the board is going to have to make, whether or not they want the employees to start contributing, but I would say there wouldn’t be any decision made on that until we have the results of the pay and benefits study. Because if we change it now we’re just going to have to change what they do in the pay and benefits study. That’s why we included benefits in that,” Clack noted.
The lack of competitive salaries in Sampson, as compared to surrounding counties, is said to be a main factor in well-documented turnover woes in various departments in recent years. Numerous employees cited the benefits as being what keeps them here.
Veterans Service Officer Ann Knowles has said great health benefits are the primary reason “why we stay with the county.”
“That’s why I’ve got 38 years here,” she noted. “I’ve never been paid a lot, but I’m looking forward to my benefits one day in retirement. That’s why your employees are loyal, because you do recognize the benefits and you don’t make us pay.”
Those benefits could very well change, and likely will, Clack said.
“I would expect there to be changes to the benefits all the way around. Part of that would mitigate the pay increases too. Right now our health plan is very competitive with our surrounding (counties), but our pay is not. One thing is sort of offsetting the other to some extent but we still have a lot of people leaving the county,” the finance officer remarked.
Clack said health coverage by the county cannot be eliminated altogether, however he knew of at least one local government “near us” that discontinued spouse’s insurance for their employees.
“No new employees can put their spouses on and existing employees have to take their spouses off,” Clack explained. “That sends them back to their employer or to the marketplace. Post-employment benefits are another thing that is quickly being discontinued, especially for your newer employees or those who might not have invested in the retirement system yet.”
Those post-employment benefits, under which retirees continue to be insured, “costs a lot of money,” and Sampson provides them to plenty of retirees.
“They help drive the cost up to some extent,” Clack stated. “Those are the things that would definitely be considered once they complete that pay and benefits study.”
Tax Office employee Susan Heath said entertaining the idea of eliminating spousal insurance was “terrible,” agreeing with Knowles and many others’ assessment that benefits were a key draw for Sampson.
“Insurance is the only thing we have going for us. That’s the only reason we’re doing this job is for the benefits. If you cut it … you would have so many people quitting their jobs. I would quit my job,” Heath said during last week’s budget public hearing. “I’ve only been here two and a half years and I’m not going to stick around for 30 years not to get on a median income salary. I’d be gone and half the people in my office would be gone.”
Chris Berendt can be reached at 910-592-8137 ext. 121. Follow us on twitter @SampsonInd.