Insurance costs: County, employees pick up $1.4 million increase

Knox County will need another $1.4 million to cover health care for its employees due to the increasing costs of specialty drugs.

The county will cover half the amount – some $700,000 – and then raise the price of premiums for its employees to cover the other half.

“It’s the skyrocketing costs of those drugs – that’s the main reason we have to do this,” said Nick McBride, the chairman of the county’s employee insurance committee. “No one wants their insurance to go up, but as we all know the costs keep rising for everyone unfortunately.”

For example, Sovaldi, a new specialty drug that has a 90 percent cure rate for hepatitis C costs $84,000 for a three-month course. A drug to combat hemophilia can cost as much as $130,000 per month.

The county is self-insured, which means it pays the costs of the claims employees file. Some 2,300 employees and an additional 3,200 family members are on the county’s insurance plan. The cost of premiums, which are deducted from each pay check, vary depending on which of the three plans an employee has and the number of people on the plan.

Starting Jan. 1, when the new plan takes effect, employees will pay an extra $5 per paycheck for individual plans; $10 per paycheck for a plan that covers them and one more person; and $15 per paycheck for the family plan.

That will set the new rates for the least expensive plan at $10, $69 and $104, respectively.

However, those costs will double if the employee does not have a health risk assessment conducted or participate in HumanaVitality, a program designed to encourage healthy lifestyle changes.

“There’s really not much we can do about the cost of the specialty drugs, but where we can save money is by working together to have a healthier workforce,” McBride said. “The employees can take the assessment – a physical – that can detect early heart disease or cancer, and give them a chance to get ahead of it.”

Last year, the county paid about $24 million in health insurance costs, said county Finance Director

Chris Caldwell, and the employees paid about a combined $4.2 million.