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FAIRMONT-- The Martin County Board of Commissioners held a budget workshop on Friday and they spent the majority of it talking about the cost of health insurance renewals and the impact it will have on the 2027 budget. Currently, the 2027 preliminary budget has the county taking on 18 percent of the rate increase.
While the county is part of the Minnesota Healthcare Consortium, Human Resources Director, Leigha Johnson, said bids from other agencies are due Sept. 24 so they can see what comes in then.
"You can see what the increases call for from the coop. There is a big difference between our lower deductible plan and our HSA plan," Johnson explained.
Commissioner Richard Koons asked if the county sent out Request for Proposals (RPFs) or if it was done through the coop. Johnson said that she sent out RFPs to four major partners.
She further explained that the information provided to the board was based on the rates provided to her from the coop. She then showed the increases per plan and how many employees are currently enrolled in each of the plans.
"The low deductible plans are getting a 19 percent increase and the high deductible plan is getting a 31 percent increase. We're looking to ask the coop to have that be more of a uniform increase," Johnson said.
However, Johnson said the county looking to increase the budget to take on 100 percent of the premium is unrealistic and that she thinks there needs to be some share by the employees.
"It would be just shy of a $300,000 budget increase," she said. "I think the biggest question for the commissioners is consideration of increasing the budget, if there's a tolerance for that, and how much."
She pointed out that they are still waiting on some bids to come back and said that some of this discussion was preliminary as the county can also negotiate with the coop.
"Bids are due the 24th and we also have a meeting with the coop scheduled for the 24th," Johnson said.
"I still question what the coop's doing for us and I've questioned this several times over the past eight years," Koons said. "What we see here is organizations within the coop with single figure digits in increases and a huge majority of them seeing double digit increases. Then they turn around and say, 'well it's based upon your claims,' Well that's why we have a coop because it shouldn't be based on our claims alone."
Bleess referenced with the information provided that had the county taking 18 percent of the increase to premiums, it showed the $2,000 deductible plan increasing $134 monthly for employees only and $793 for a family plan.
Johnson said the deductible plan didn't worry her as much as the increases to the HSA plan, as it's a $423 increase per month.
She said last year there was an 8 percent increase and the year before there was a big increase, and the consistent message they hear from staff is that COLA and step increases mean nothing with these increases.
Commissioner Joe Loughmiller agreed and said, "there's no net increase to their paycheck."
He asked if they should continue to encourage the HSA plan and Johnson agreed that was best but Commissioner Billeye Rabbe asked if they should get rid of it altogether.
"I don't think we want to," Johnson said.
After half an hour of discussion, Commissioner Kevin Kristenson said he thinks they need to wait and see what happens on the 24th. He was hopeful that the 31 percent increase on the HSA plan would go down, so that people wouldn't jump from the HSA plan to the $2,000 deductible plan.
"We can actually have two different plans that are reasonable," Kristenson said.
Johnson asked the board again whether it wanted to raise the budget beyond what it's been looking at. Bleess asked what has been budgeted so far and Johnson said $2.45 million, which is about a $200,000 increase over last year but Auditor/Treasurer Mike Forstner said what was set in 2026 was higher than what was actually spent.
If the county takes on 100 percent of the increase to premiums, it would be an additional $295,000 to the county.
"If we're already contributing $200,000 more in 2027, and that's currently planned in our budget, and they're contributing $74 per paycheck more pre-tax more on a family plan (non HSA), to me, that's more than fair," Bleess said.
He agreed that the HSA increase was a lot, which everyone agreed was a one-off this year.
"We've talked about whether that can be flattened because one plan being a 31 percent increase isn't realistic," Johnson said.
Switching gears to talk about the budget as a whole, the board looked at where they started at in the 2027 budget and levy process, which was a 7.52 percent increase and then a 6.59 percent increase and now a potential 5.98 percent increase. However, Forstner said $145,000 needs to be trimmed from the budget to get there.
"Maybe you should go back and ask people to cut 5 percent from their budgets," Rabbe said of the department heads.
However Loughmiller pointed out that the preliminary budget needs to be approved by the end of this month and that he personally would not be available for many more budget work sessions.
Bleess suggested having the departments look at their budgets again before the final budget needs to be approved in December.
"I like the 6.59 as a preliminary. It gives us room to be flexible and doesn't constrain us too much and it's still something that won't cause the world to erupt," Loughmiller said. "I think the 5.98 puts unnecessary shackles on us," Loughmiller said.
Once the preliminary budget and levy is set, it cannot be raised, only lowered.
Koons still expressed frustration with the unknowns of the health insurance renewal numbers.
"We need to January 1 send out RFPs on our own and want them back no later than June 1 because this co-op is not a co-op. They are a bend you over, take advantage of you organization," Koons said.
He took issue with the fact that the county didn't get numbers back until late August this year, which was well into the budget process for 2027.
At the end of the workshop, Koons agreed that the 6.59 percent levy increase was good as a preliminary but that department heads would need to cut more from their budgets before the final budget and levy is set.
The board still has until Sept. 30 to approve the preliminary budget and levy.