Most Johnston towns looking to join North Carolina’s state health plan have learned they made it in.
But Smithfield and Archer Lodge might have to wait in line or leave well enough alone.
The Smithfield Town Council reviewed the town’s insurance during its meeting last week. Human resources director Tim Kerigan told the council that Smithfield’s savings aren’t as substantial as others, but they’re savings nonetheless.
“We’re in good standing with our current plan,” Kerigan said. “Some communities might find a much larger savings with the state plan, but that’s not necessarily the case with us. ... We fought hard for the rate we have.”
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Through General Assembly action this past session, the state opened up its employee health insurance to local government workers. But lawmakers capped the threshold at 10,000 people, including employees and dependents.
Legislators wanted to shield towns with smaller pools from spikes in premiums, and the response was significant. Within a few months, interest from towns and counties had flooded the state treasurer’s office, and enrollment has already exceeded the cap.
In Johnston County, Benson, Clayton and Selma made it in. Benson employees began coverage at the new year, and Clayton workers will join Feb. 1, with Selma following on March 1. Kerigan said the state had informed him that it might raise the enrollment cap.
“There was enough interest to possibly exceed the 10,000 life threshold,” Kerigan said.
The Town Council advised Kerigan to keep Smithfield’s place in line, but if space for the town’s 131 employees opens up, it’s ambivalent about jumping on board. Towns that do join, join forever, meaning that governments might see lower premiums with the larger pool but will lose independence.
“I thought there must be some way to get out of the plan if you really needed to,” Kerigan said. “They said yes, if you dissolve your town’s charter. We’ve been around since 1777, so I don’t think that will happen.”
Some on the council saw the state’s greater bargaining power as a plus.
“The world is changing, but in the past, the more people you had on a policy, the better deal you got,” Councilman Perry Harris said. “I still think that’s true, but it might not be as true as it used to be. My concern with all of this is that our employees might not see 30-percent increases but 50- or 60-percent increases a year [in a smaller pool].”
Another deterrent for Smithfield is the town’s retirees. The state plan won’t allow local governments to bring their retirees, meaning towns would have to buy other policies, most likely through an Affordable Care Act exchange.
“We don’t know what those premiums will be,” Kerigan said. “I wish I had a crystal ball on all of this to say that one way would be better than the other. ... My greatest concern is the [retirees]. I have a hard time imagining those premium are going to be low.”
Archer Lodge’s lone employee, Town Clerk Kim Batten, is also waiting to hear back from the state regarding her health insurance. Archer Lodge entered the process late in the game, choosing to move forward during its meeting last month. But town leaders thought their one employee wouldn’t be hard for the state to accommodate.
“I hope so,” Batten said.
Drew Jackson: 919-553-7234, Ext. 104; @jdrewjackson