Buckle up and hang on as this is going to be a bumpy read. Anytime you employ a lot of statistics, there’s the possibility folks will get lost in the numbers. Let me encourage you to stay with me until we’ve uncovered “the rest of the story.”
According to the Henry J. Kaiser Family Foundation (KFF), in 2008, the average employer-sponsored family healthcare plan cost $12,680 annually, with employees footing $3,354 of the bill. By 2016, the average employer family plan grew to $18,142 for the year, with workers picking up $5,277, approximately 30 percent of the tab.
Care to guess how Cook County’s employer-sponsored healthcare plans fared in 2008?
Cook County taxpayers shelled out nearly $1.2 million in 2008 for employee healthcare benefits…with no contribution coming from employees.
It wasn’t until May 2012 that one of the county’s three bargaining groups began paying a portion of their healthcare premiums. The Law Enforcement Labor Services (LELs) group began contributing $25 a month for those who enrolled in family coverage; those who enrolled in single coverage continued to receive their healthcare benefits at no cost to the employee.
Two years later, 2014, the other two Cook County bargaining groups: Cook County Employees Association (CCEA) and International Union of Operating Engineers, AFLCIO (49ners) began contributing $25 a month ($300 annually) to their family health insurance plans with the county picking up the rest of the tab. Still no contributions required from single coverage employees.
Then, in 2016 the county negotiated a $50 monthly contribution from employees for single coverage and $75 for family coverage. This increased to $75 a month for single and $100 a month for family in 2017.
As employer, Cook County also contributes $1,200 per year into a fulltime employee’s personal health account (VEBA or Voluntary Employee Beneficiary Association trust fund) and $1,100 per year for each part-time employee enrolled in the plan.
When commissioners met on the afternoon of May 20, 2016 with the representative from Keystone Compensation Group to discuss the parameters of the Compensation and Classification Study, I asked the representative if, in addition to wage comparisons, we would be conducting a comparison of benefits? I referenced a survey conducted by Monster Insights, which asked the question: “What Employee Benefits Matter Most to Job Seekers?”
Survey results found that healthcare coverage was the most valued benefit; selected by almost one-third (32 percent) of respondents.
Given this significance and the fact that costs for healthcare benefits continue to surge, I believed a compensation study that did not include a comparison of benefit packages would be incomplete.
I was told Keystone did not perform such a comparison. I stated I would be willing to conduct the comparison by contacting the same counties selected for wage comparison. County Administrator, Jeff Cadwell, suggested he be the one to conduct the study, to which I agreed; however, a study was never presented to commissioners during the eight months that completed my term as commissioner. I asked my replacement if he had ever seen such a study and his response was, “No.”
As we all know–at least those who pay premiums out of their own pocket–health insurance is expensive with costs increasing annually. Cook County experienced a 5.1 percent increase in 2018 and is projecting a 10 percent increase for the 2019 budget.
At the close of the 2017 budget discussions in 2016, commissioners proposed and passed a motion that all 18 department heads begin, in 2017, to contribute 20 percent, out-of-pocket, toward their healthcare premiums. It was an effort, in good faith, to encourage department heads to “lead by example” for the rank and file employees, so to speak.
Immediately following this action, County Administrator Cadwell began to have second thoughts and sent a December 22, 2016 communiqué to commissioners stating so.
A month later, during the January 17, 2017 Cook County Board of Commissioners’ meeting, commissioners took the following action, as recorded in the minutes:
“Jeff Cadwell, County Administrator, appeared before the Board to request the Board authorize a change in the VEBA allocation for staff affected by the increase in employee share of premiums for County Health Insurance. Cadwell explained that because of the increase, many of the staff affected are receiving less pay in 2017 than in 2016, even with the 2.5 percent
COLA [Cost of Living Allowance]. Cadwell stated the single coverage increase would be from $1200.00/ year to $1800.00/year and family from $1200.00/year to $2400.00/year to help make up the difference.
“Motion was made by Bursheim, seconded by Storlie, and carried by unanimous vote to approve the VEBA allocation for the 18 staff affected by the change in employee share of premiums for County Health Insurance.”
Here are the county’s current rates for health insurance:
. Single Coverage $694.00 a month or $8,328.00 a year;
. 20 percent of monthly premium paid by employee ($138.80 a month) amounts to $1,665.60 a year;
. 80 percent paid by county for single coverage amounts to $6,662.40.
. Annual Deductible: $1,850.
. Family Coverage $1,734.00 a month or $20,808.00 a year
. 20 percent of monthly premium paid by employee ($346.80 a month) amounts to $4,161.60 a year
. 80 percent paid by county for family coverage amounts to $16,646.40
. Annual Deductible: $3,700
2018 premiums are projected to be $2,095,636 with a projected 10 percent increase in 2019 ($209,564), which amounts to $2,305,200 or roughly 12 percent of the county’s total budget.
So here is where “The Rest of the Story” comes in.
When County Administrator, Cadwell, publicly declared, during the January 9, 2018, commissioner board meeting, that employees will now be paying 20 percent of the cost for their healthcare premiums; what he didn’t divulge is the fact that you–the taxpayer, will be picking up the tab! That’s right, you heard me right! Commissioners agreed to increase county employees’ wages to cover the cost of the increased premium contribution. And this isn’t a one-year increase; in other words, these added dollars don’t go away.
According to a 2015 NPR/Robert Wood Johnson Foundation/Harvard T.H. Chan School of Public Health poll, more than a quarter of adults say healthcare costs have caused a serious financial problem with 42 percent indicating they have spent all or most of their personal savings to cover costs.
Who, among us, would complain about an increase in our healthcare premiums if we were assured, “Not to worry. No cost to you. Someone else will be paying for it,” namely you, the taxpayer!
In the immutable words of Paul Harvey, “Now you know the rest of the story.”
Former Cook County Commissioner Garry Gamble is writing this ongoing column about the various ways government works, as well as other topics.
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