According to government statistics, health care costs in the United States are growing about 5.8 percent a year and in 2016, costs exceeded $10,000 annually per person for the first time.
But Owensboro Municipal Utilities is bucking the trend of higher health care costs and the higher health care insurance premiums that typically follow.
On Thursday, the OMU board of directors received a report stating that health insurance premiums for the utility’s employees will not increase in 2018 for any of its three insurance plans — basic, premium or health savings (high deductible) accounts.
“OMU’s health care cost per individual had been slowly increasing just like most employer plans across the United States,” an OMU memorandum said. “In 2015, costs were lower than prior years due to our decision to change third-party administrators and use a different health care network (Anthem Blue Cross/Blue Shield). In 2016, OMU saw an 18.9 percent decrease in cost per individual. 2016 is the second year of our Employee Wellness Program, which not only promotes healthier lifestyles for employees and spouses but encourages baseline testing to identify chronic disease and and begin treatment and/or lifestyle to limit the size and frequency of large claims.”
An OMU graph shows health care costs per covered individual averaged more than $5,000 a year in 2013 and 2014. But those costs dropped to $5,000 a year in 2015 and $4,000 last year.
At OMU, the basic health plan costs an employee nothing. The premium plan costs the employee $618.96 a year ($1,238.16 with one family member included and $2,519.29 for the family plan). The health savings account plan costs the employee 26 percent less than the premium plan, but the employee is responsible for the first $2,000 in costs for individual coverage. OMU employees opting for the health savings account plan receive a $500 credit ($1,000 for employee-plus-one, or family plans), to offset the costs of the premium.
Employees of the utility will see a 10 percent increase in dental premiums, however, because of “continued and increased utilization rates …” OMU pays the dental premium for employees, but not for spouses or other dependents. The per pay period dental premium for an employee and spouse will rise from $16 to $17.60 and from $36.05 to $39.65 for a family.
Michael Moore, OMU’s director of customer service and shared services, said OMU has had health care costs control measures in place for about five years.
“We have a chronic care program, a (discount) prescription drug program and our wellness program,” Moore said. “Nationally, health care costs are rising, and ours are going down. Something is working.”
Since May 2016, OMU employees and family members who have chronic health conditions are enrolled in a program called “Edumedics,” which provides them with strategies to lower their costs and improve their health, according to the memorandum signed by Moore.
Currently, 58 percent of OMU employees and 42 percent of their spouses participate in the utility’s wellness program, which includes incentives in lifestyle areas that drive down claims.
OMU has one other advantage in helping contain health care costs. Moore said the average age of its employees is 44, which is below average for utilities. On average, younger workers experience fewer health care claims than older workers, he said.