Bexar County Struggles With ‘Explosive’ Health Insurance Costs

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The Bexar County Courthouse sits at 100 Dolorosa near Soledad. For divorcing men in San Antonio, this is where their pain and loneliness begin. Photo by Scott Ball.

The Bexar County Courthouse sits at 100 Dolorosa near Soledad. For divorcing men in San Antonio, this is where their pain and loneliness begin. Photo by Scott Ball.

Due to rising healthcare costs for its 4,700 employees, Bexar County’s fiscal year 2017 budget is one of the most challenging it has seen in recent years. Commissioners must find $7 million in savings – about the same amount health insurance costs increased last year – to balance its $1.83 billion budget before it’s up for a vote on Sept. 13.

“‘Half’ shows up a lot in this budget,” said Bexar County Manager David Smith during his annual proposed budget presentation to County commissioners on Tuesday. “It’s not everything you want it to be.”

Click here to view the proposed budget and here to download the summary presentation.

From fiscal year 2015 to 2016, health insurance costs increased by $7.2 million and County officials expect exponential increases to unsustainable levels in proceeding years if costs aren’t reined in.

Bexar County's projected insurance costs. Image courtesy of Bexar County.

Bexar County’s projected insurance costs. Image courtesy of Bexar County.

There are four main culprits for this unprecedented increase, said Bexar County Director of Management and Finance Seth McCabe: There has been an uptick in total cost and number of high-cost claims, 492 employees and eligible family members have jumped on the plan, prescriptions drugs are more expensive, and the plan design and coverage itself heavily favor the employee.

“Part of this stems from the fact that the County hasn’t approved plan changes for health insurance for employees since 2012,” McCabe said. “So as time has gone on, what we’re seeing is that the County is offering more beneficial plans to its employees as compared to other public sector entities.”

Spouses of Bexar County employees do not have to pay monthly premiums. Those of City, SAWS, Northside ISD, and Northeast ISD employees do. County employees, for the most part, have lower deductibles and out-of-pocket maximums. Possible solutions offered by County staff include raising those costs, adding a tier for spousal coverage, and changing the plan design. Uniformed officers who work for the County have different health insurance plans than civilians, as do City police and firefighters.

Commissioners will meet during multiple budget sessions scheduled over the next several weeks to find the $7 million solution to its health care costs, among other items.

While the budget does include a decrease of property tax rate from $0.30895 to $0.3145, it wasn’t as aggressive as commissioners originally expected when budget discussions started this spring. Instead of a 4% restraint on property tax revenue growth, County officials estimate growth at 6%. Property taxes in Bexar County haven’t gone up in 20 years.

History of property taxes in Bexar County.

Image courtesy of Bexar County.

Another initial goal was to raise the minimum wage of County employees to align with a $15 per hour living wage.

“At this time I can’t recommend that,” Smith said. Instead, there will be an increase to $13.50/hour at a cost of $1.6 million, which includes some salary compression. Wages were increased to $13/hour last year at cost of $6.6 million.

A dozen members of COPS/Metro Alliance and other organizations attended the meeting to advocate for the wage increase that would, said COPS/Metro leader Mike Phillips, “build a path of opportunity for all our residents.”

City Council is under the same pressure to increase pay, but the city manager’s proposed budget does not include a wage increase.

(Read More: City’s 2017 Budget Balances Basics and Innovation)

While some commissioners support striving for $15/hour, such a move doesn’t make fiscal sense at the moment, Smith said.

“It is a tough year, but we also have to remember it is not easy for taxpayers,” said Commissioner Paul Elizondo (Pct. 2). “I wish we could do more, but we have covered the essentials and will be able to get done what is needed.”

County Judge Nelson Wolff gives a statement to the press after Bexar County commissioners agreed to vote yes for a $13/hour minimum wage for County employees on June 10, 2015. Photo by Scott Ball.

County Judge Nelson Wolff gives a statement to the press after Bexar County commissioners agreed to vote yes for a $13/hour minimum wage for County employees on June 10, 2015. Photo by Scott Ball.

The proposed budget also removes 17 deputy constables, nine clerks, one full-time and one part-time judge.

“I don’t want to give the impression that we’re cutting law enforcement,” said Bexar County Judge Nelson Wolff.

Those cuts were made because the total workload for the Justice of the Peace Courts have declined by 35%, McCabe said. Overall the budget adds 18.5 positions, including three new sheriff sergeants, two new public safety communication supervisors, five new prosecutors, and four new investigators.

If this budget is adopted, Bexar County will give $359,564 less this year to dozens of so-called “outside agencies” that provide social services within the county such as Beat AIDS, Family Service Association, Christian Senior Services, PEACE Initiative, San Antonio Food Bank, and more.

Most agencies were funded at the same level this year, Smith said, but others did not request any funding this year.

COPS/Metro had asked for a funding increase of $150,000 for Project Quest, a workforce development and continuing education program as well as to fully fund the multi-million dollar reconstruction of the mismanaged Highland Oaks housing development which was approved last year.

“Some of this is in the budget, some we would have to discuss,” Wolff said.

The proposed budget instead includes $80,750 for Project Quest, $750,000 for the Highland Oaks road project, and $100,000 for SA Works, which is another workforce/education development program that combines the efforts of the County, City, San Antonio Economic Development Foundation, and San Antonio Chamber of Commerce.

“We have to work together to get the curriculum that’s already been made by the (Chamber) of SA Works truly implemented through the curriculum committees,” said Commissioner Thomas Calvert (Pct. 4). “I don’t always feel the same sense of urgency from our school districts, however, to understand that we’re in the information technology economy.

“When we do that, we’re going to be able to have companies from around the world say, ‘We want to move to San Antonio because you have a pipeline of IT professionals ready.'”

The 10-year, $500 million Bexar County Flood Control program ends after next year’s budget. Including $204 million for the San Antonio River and $125 million for San Pedro Creek improvement projects, Bexar County will have actually spent almost $770 million on flood control projects over the last 10 years.

Commissioners said they would look into funding mechanisms to continue this “critical” work that will likely have a never-ending price tag.

“We live in flood alley, Texas,” Elizondo said. “We caught up a little bit on the needs that we have (with the $500 million). …. But we don’t get to say, ‘We did it – it’s done.'”

He suggested the possibility of instead keeping the property tax rate flat or setting aside 10% of bond refunds for flood control projects.

Calvert agreed that a such a small decrease typically means very little to homeowners, but that it could have a large impact on the County’s other infrastructure needs.

“We want to have something to campaign on – that’s the nature of the business we’re in – we’re in a political business where (people) like bumper stickers where we can say we deliver.”

But the public safety, jobs, and long-term infrastructure benefits created by the flood control program are worth more to the community, Calvert said.

He added that infrastructure and capital projects could be leveraged to “create vibrancy” around key assets in the city like the AT&T Center, which is in his precinct. The Spurs could look to other towns that have more attractive, urban centers, he said.

“We lowered it (the tax rate) four times,” he said, “but did anybody feel it?

 

https://rivardreport.wildapricot.org

 

Top image: The Bexar County Courthouse sits at 100 Dolorosa near Soledad. Photo by Scott Ball. 

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