The Opportunity: Lincoln County’s health care benefits costs were out of control. In a good year, their insurance rates would increase by 10%. In their worst years, they absorbed rate hikes as steep as 30-40%. As stewards of taxpayer dollars, they felt compelled to control these costs by completely re-evaluating their approach to health benefits. The Solution: With guidance from BetterSource Benefits, Lincoln County transitioned to a self-funded health plan. By taking greater control over their plan, the county slashed costs while improving the quality of care their employees received. The Payoff: The county has seen numerous benefits since switching, including improved quality of care, consistency in their plan, and a dramatic reduction in costs. The biggest payoff, however, has been a $181,346 plan refund in their second year of self-funding. Reaching A Breaking Point: Enduring 40% Rate Increases Lincoln County, Kentucky is a quaint jurisdiction located about 50 miles south of Lexington. With about 50 full-time employees on its annual payroll and approximately 25,000 taxpayers to serve, the county regularly evaluated its health care plan to find the best deals as a steward of taxpayer dollars. Despite their best efforts, Lincoln County regularly endured significant rate hikes. Although it wasn’t unusual to see rate increases of 10%, the county eventually saw prices rising 30% or 40% in a single year. Sustaining such a plan became unrealistic. Lincoln County initially reached out for assistance in brokering better rates, but we gradually recommended pursuing a self-funded plan option where the county would essentially take They initially turned to BetterSource Benefits for brokering services, negotiating the best rates on the best deals available to Lincoln County employees. As an alternative strategy, we recommended pursuing a self-funded plan, which would pull them away from costly insurance providers and allow them to slash expenses. The county was initially reluctant, as self-funding requires accepting greater risk. But after another 40% rate hike threat, the county leaders acknowledged that continuing down the same path was potentially even riskier. They were ready to adopt a new plan. Pursuing Self-Funded Options Shifting away from the traditional health care model immediately opened opportunities for better care and pricing. We worked closely with county officials to provide additional layers of assistance to employees, including the following: Using scholarships and coupons from pharmaceutical companies to receive discounts on expensive medications Relying on telehealth options, like the Ask a Nurse or Call Before You Go programs to reduce the use of unnecessary and costly medical care Promoting preventative medicine, like annual checkups, colonoscopies, and mammograms, by offering employees bonuses To ensure a smooth transition, BetterSource Benefits adopted a greater role among the staff at Lincoln County. We trained employees on the new plan’s nuances and best practices, like using Ask a Nurse to avoid costly doctor appointments or Call Before You Go to avoid an expensive trip to the emergency room when an urgent care could be a viable, and less expensive, option. Realizing Significant Savings The biggest benefit by far has been a $181,346 refund in the program’s second year. This refund is especially valuable in 2020, when the pandemic drained many of the county’s resources. The refund is going into the general fund to replace many of the losses the county has suffered. Lincoln County has benefited beyond the financial benefits, however. For the first time in nearly a decade, the county has had the same plan for two years in a row. That sudden consistency benefits everyone involved. The county now has a better handle on its health care costs and its team can budget more effectively. Similarly, county leadership has avoided the long, costly process of sorting through potential plans for the coming year. On the employee side, workers have avoided a similarly long orientation process to familiarize themselves with a new plan. Set Up for Future Success Looking ahead, Lincoln County is optimistic about the value its health plan can continue to generate. After COVID-19, major refunds like the one it received this year can be used in a variety of ways, from starting much-needed renovations to county facilities to continuing to invest in repairs for its 400 miles of roads.