Supervisor Pitches Idea Of Signing On To County's Health Insurance Plan

SOUTHOLD, NY — With the 2018 Southold Town budget process underway, Supervisor Scott Russell said one way to summon up major savings would be to enroll the town in the Suffolk County health insurance plan.

Suffolk County has a self-insurance plan; Southold used to maintain its own, Russell said in an email after Tuesday's town board work session.

"Very basically, rather than pay annual costs of being enrolled in another plan, towns can set up their own risk retention funds. A third party administrator is hired to manage the medical insurance program and all costs such as doctor bills, hospital billing, etc. get paid from that fund," the supervisor said.

Each year, he added, the town restores the retention fund balance by evaluating costs from the previous year and after considering other factors such as increasing medical care costs, and administrative costs.

The annual cost of maintaining a self-insured plan on a per-covered employee basis had historically been less than the New York State Health Insurance Plan, which was with Empire, Russell said.

"The problem is that we have a small pool of employees which means a smaller risk retention fund. It only takes a few catastrophic illnesses to radically draw down that fund. To limit our future exposure, I dissolved the fund and switched coverage back to NYSHIP," he said.

That said, Suffolk County maintains its own self-insured medical plan and the current annual cost is $18,000 per policy for family coverage, Russell said.

Currently, the town's cost to NYSHIP is is about $27,000, with employees paying a portion of their medical costs, and the town's actual costs per family policy around $24,600.

"If we enrolled in the County plan, the town's actual costs would be $17,100," Russell said.

With Southold Town paying for 114 family coverage plans currently, and the town's anticipated savings $7,500 per plan by rolling into the County plan, the savings would be about $855,000 to Southold Town, he said.

And, Russell added, if the 52 other family coverage plans for town police officers were included, the town would see an additional $390,000 each year in savings — for a total savings of more than $1.2 million annually.

With Russell finishing up the budget, he said medical costs have gone up 9 percent. "A lot of things are not discretionary; they are mandated costs," Russell said.

With "the strength of Wall Street," currently, the town is in good standing with not much of an increase in retirement funds, he said.

Both he and Riverhead Town Supervisor Sean Walter attended a meeting about potential shared services in Suffolk County, with medical costs discussed in a subgroup.

In order to proceed with that plan, state legislation would be needed, Russell said.

Currently, any self-insured program can only take on 3 agencies; state legislation would be needed to change that rule.

Russell said he's spoken to New York State Assemblyman Anthony Palumbo to commence "some movement" and see if talks with Suffolk County about participating in the medical plan might commence.