Kossuth County participants weigh higher deductibles, HSA incentives to shore up self-insurance fund

Participants in a Kossuth County meeting discussed several options to shore up the county’s self-insurance fund, including raising the target fund balance, increasing employee contributions, and offering a high-deductible plan combined with health savings account (HSA) incentives. No formal action was taken; participants asked staff to model specific scenarios and agreed to revisit the item next week.

The discussion focused on a reported actuarial estimate and several budget scenarios. Speaker 2, role not specified, read an actuarial figure, saying, "They say the estimated maximum liability is 3,939,669, dollars to for this next year." Participants contrasted that number with current and budgeted revenue figures: Speaker 2 said present revenue is "$2,843,700," while Speaker 1, role not specified, said their budgeting calculation produced "$3,340,692," leaving a potential gap if the county faced the actuarial worst-case. "I always thought 3,000,000 was, you know, very comfortable," Speaker 1 said when describing a preferred target for the fund.

Board participants laid out three primary policy levers to arrest further declines in the fund balance: increase employee contributions, raise deductibles and out-of-pocket maximums, or incentivize movement to a high-deductible plan with an HSA match. Using an example, Speaker 1 walked through the math for a $100-per-month employee increase and estimated roughly $154,800 in additional revenue. Speaker 2 outlined a sample plan design with a $2,500 deductible and $5,000 family out-of-pocket maximum and asked if the group wanted that modeled.

Speakers debated employee behavior under a two-plan offering versus a single higher-deductible option. Several participants said the high-deductible plan could be economically attractive if coupled with an HSA and an employer match. Speaker 3 described the matching mechanism: if the county matched employee HSA contributions up to a limit (for example, $100), that could make the high-deductible option more appealing. Others raised concerns about employees who prefer levelized out-of-pocket costs throughout the year rather than front-loading costs to a deductible.

Tax implications and historical context factored into the conversation. Speaker 6 cautioned against simply raising taxes to cover higher benefit costs, saying, "I'm not gonna be excited about raising the millage rate" to pay for health insurance. Participants also recalled prior changes that were implemented to slow the fund balance decline, including prior increases in deductibles and stop-loss adjustments.

Staff were asked to model several scenarios — including current plan continuation, higher-deductible plan with HSA matching, and specific employee-contribution increases — to show the projected impact on fund balance and budgeted revenue. The group agreed to continue the discussion at the next meeting when staff returns with modeled numbers.

Next steps: staff will prepare modeled scenarios of the suggested changes for review at the follow-up meeting; no vote or formal decision was recorded during this session.