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Defending a tax increase that helped county employees pay for health insurance, Milwaukee County Board Chairwoman Marina Dimitrijevic told a Milwaukee radio interviewer that workers had seen those costs rise substantially two years in a row. She deflected a question about private-sector benefits, saying the proper comparison point for county benefit costs is what other government workers pay. When you compare them (Milwaukee County employees) to the City of Milwaukee and the State of Wisconsin, they are paying much more than their counterparts, Dimitrijevic told WTMJ-AM (620) afternoon show host John Mercure on Nov. 14, 2012. You have to compare apples to apples. It’s been well-publicized that Gov. Scott Walker’s Act 10 collective bargaining law increased state employees’ health care costs. And Milwaukee -- while not under Act 10’s health care mandates -- got its workers to pick up a greater share of such costs in the wake of the law. But are county workers paying much more than state and city employees? It’s an interesting question, given the prominence of the health care issue in the 2012 county budget tussle between the County Board and County Executive Chris Abele, who again had sought larger cost-sharing from employees. First, a few words of caution. While there are credible ways to compare health insurance plans, it’s a complicated exercise because costs can vary significantly depending on employees’ health and the intricacies of each plan’s design. For simplicity’s sake, our analysis is based on insurance costs for current employees, not for retirees. The figures discussed here apply to most, but not all, employees of the three governments. We examined reports that Dimitrijevic says she relied on in making her claim, and spoke with city, county and state officials about their health plan offerings for 2013. We’ll start with two key measures: Plan design State employees have no annual deductible, receive 90 percent co-insurance and have comparatively low limits on yearly out-of-pocket costs (ranging from $500 for single coverage to $1,000 for families). That gives them a clear advantage over city and county workers. Most City of Milwaukee workers chose a plan with deductibles of $500 to $1,000 and out-of-pocket caps of $1,000 per person/$2,000 family. The co-insurance picks up 90 percent. The city plan does not charge co-pays for office visits. County workers face the highest deductibles ($800-$1,850) and by far the highest out-of-pocket limits ($2,500 per person to $5,000 per family). Office and prescription co-pays do not count toward that maximum. Their co-insurance pays less than at the city and state -- 80 percent. But for 2013, the County Board, over Abele’s objection, funded a county contribution to employees to reimburse them for eligible health care expenditures such as co-pays, deductibles, co-insurance, dental care, or vision care. The county contribution to these flexible spending accounts ranges from $600 for a single employee to $1,800 for a family. So that can offset most of an employee’s costs up to the deductible. And county officials say it brings those county employees who use very little health care into rough parity with city employees. Still, county workers face higher out-of-pocket payments than city workers if their medical costs mount. And the difference could amount to several hundred dollars, or a couple thousand dollars in a bad health year, so it’s significant. It’s not clear how many people fall into the higher-use group, though after 10 months of 2012 about 35 percent had met their deductible. That includes retirees, but the figure for active workers would be comparable, said the county’s benefits administrator, Matthew Hanchek. Monthly Premiums County workers pay the highest premiums, and they can’t use that county contribution towards them. City employees are on the low end with premiums ranging from $54 monthly to $173 in the most popular plan. Most state workers will pay $85 to $211. By contrast, county workers will pay $100 to $225 a month, putting another gap between them and the rest. Let’s try to tally it up: It’s clear that state employees have the lowest costs. That leaves county vs. city. We asked the county’s Hanchek about the city vs. county comparison. He said the flexible spending contribution brings the county plan close to parity with the city’s when you consider all active members. There’s some support for that by another measure: the collective employee share of their employer’s total health care bill. At the county, that figure is a projected 23 percent to 27 percent for 2013, depending on which measure from several county sources you prefer. The city is in the 23 percent to 25 percent range, said Michael Brady, city employee benefits director. To the extent those figures are apples-to-apples, they suggest there isn’t much difference between the plans as a whole. Benefits officials caution that these aggregate figures don’t necessarily reflect a typical employee’s experience. Hanchek did note that the city’s premium costs are a bit lower than the county’s, which he attributed mainly to demographic factors. County Comptroller Scott Manske looked at the situation a different way and drew this conclusion: At higher usage levels, county workers likely face much higher out-of-pocket costs, compared with city workers. At average usage levels, it’s a wash or the county worker could pay a little more, he said. We’ll give the final word to Richard Abelson, executive director of AFSCME District Council 48, the labor organization that represents many city and county employees. Both employee groups have been asked to pay more for health benefits in recent years, Abelson said. The bottom line, in Abelson’s view, is that city workers pay a little bit less than their county counterparts, even when the county’s flexible spending account is considered. One final note. We found that city workers earn $50,476 on average, slightly more than state ($49,534) and county workers ($50,188), so at least in a rough sense city employees may have a bit more ability to pay. Our rating Dimitrijevic said Milwaukee County government employees are paying much more for health insurance than their counterparts at the City of Milwaukee and in state government. There’s mixed evidence, but we think a fair reading of the numbers is that some county employees will pay more. The precise number is hard to judge. And those people could pay out much more if you think hundreds of dollars a year or more is a big deal. But there’s an important detail here that undercuts Dimitrijevic’s claim: the county’s contribution to workers’ flexible spending accounts. Because of that, some city and county employees ultimately may pay similar amounts when you factor in that taxpayer-funded contribution. We rate Dimitrijevic’s statement Half True.
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