County raises back in budget?
Published 7:49 pm Wednesday, August 12, 2009
If the Pike County Commission continues on the same path, it looks like county employees may keep their 3-percent anniversary raises after all. But, there’s a catch.
With rising health insurance costs, the raises will not even cover the costs of insurance increases for those employees providing for their families.
“A person would have to make $60,000 or more a year for a 3-percent increase in wages to cover it,” said County Administrator Harry Sanders.
Sanders said he won’t know an amount for certain until September, but the costs will be significantly higher for the county’s budget.
Health insurance is provided for county employees, but those who pay for their family’s coverage will be paying around $1,800 more per year, Sanders said.
And, with that in mind, the commission has decided to reconsider its initial discussion to remove the annual raises, which all employees receive on the anniversary of their date of hire.
“That’s one reason the commission is now looking at adding the 3 percent back (in the proposed budget),” Sanders said. “With this insurance increase, employees would actually have a cut, and some of their increases won’t be enough to make up the difference.”
Sanders said the reason insurance costs are increasing is two-fold. One is the premiums are simply rising by about 10 percent, but the other is because the county will be moved from premium to standard coverage because it doesn’t have enough retired employees on its insurance plan.
Sanders said six are needed to keep the rates lower, but there is only one choosing to pay into the plan now.
These costs will be a big jump for the county’s budget, but as proposed now, the commission should still end the next budget year with around $148,000 in excess revenues.
But, while health insurance costs are on the rise, the county has found a way to save on life insurance and short-term disability.
Both of these benefits, covered by the county, cost about $6.50 per employee each month under the current plans.
That insures employees with a $10,000 life insurance policy and a short-term disability of $50 per week for 52 weeks out with an illness or accident.
The costs will essentially remain the same, but employees will now receive $15,000 life insurance coverage under the new plan.
“It’s just a way of the county being able to give a better amount of benefit without any increase in cost,” Sanders said. “We don’t get to do that very often so when we do, we need to take advantage of that.”
The switch to use Lincoln Financial Group for life and short-term disability insurance was approved by the commission Monday. There will be no lapse in coverage during the switch.