News From Terre Haute, Indiana

February 13, 2013

County insurance claims falling

Vigo sees drop for fourth straight year

Howard Greninger
The Tribune-Star

TERRE HAUTE — For the fourth year in a row, total insurance claims and medical claims have decreased for Vigo County government from the previous year — on the order of more than $350,000 a year.

The county paid $3,068,001 for all claims in 2012 compared with $3,430,295 in 2011, a decrease of 10.6 percent, according to a report from Anthem Blue Cross and Blue Shield. Total medical claims dropped 13 percent, from $2,740,564 in 2011 to $2,384,772 in 2012.

The county is self-insured with a contract through Anthem. The lower costs are the result of a nearly 100 percent use of generic drugs by county employees, a spousal carve-out that removed spouses whose employer offers insurance, and a tiered drug category that requires lower-cost medications be tried first to treat ailments.

The county in 2012 had 777 employees and dependents on its insurance, up from 767 in 2011.

“One thing that is very encouraging, is the medical membership is up about 1.3 percent. While we have seen a slight growth in that number, there still is a decrease in the overall paid claims,” Lisa Wyeth of Anthem told the Vigo County Board of Commissioners Tuesday.

The highest claims were paid for diseases of the circulatory system. People with claims over $10,000 composed 58.1 percent of all paid medical and drug claims for 2012, compared with 62.1 percent in 2011.

“There are a handful of individuals who are driving the lion share of the paid medical claims. That is pretty typical,” Wyeth said.

Jacque Pentell, vice president of employee benefits at Forrest Sherer Insurance, said a general rule is “80-20, where 20 percent of your population is driving 80 percent of the claims. That is members, not dependents,” she said.

The type of claim with the highest amount of paid claims was in the outpatient category. “That is excellent,” Wyeth said, as inpatient admissions are more costly than outpatient claims.

Total claims per employee per month decreased 11.2 percent, from $721.50 in 2011 to $640.35 in 2012. Total claims per member per month decreased 11.7 percent, from $372.48 in 2011 to $328.90 in 2012.

Medical claims per employee decreased 13.6 percent and medical claims per member decreased 14.1 percent from 2011 to 2012.

Commissioner Mike Ciolli questioned how much savings the county is receiving from a medical clinic. Pentell said the county’s clinic, opened in April 2012, does not yet have a full year’s experience to compare costs and expenses. However, the county had previously implemented wellness programs that will reduce costs, Pentell said.

County Auditor Tim Seprodi said the county has paid about $225,000 for the clinic, and costs are averaging about $25,000 a month. That will be reduced about $15,000 from payments from Advics Manufacturing, which also uses the clinic housed in the Vigo County Annex.

Ciolli said commissioners will seek a two-year contract, instead of a one-year renewal, with Anthem in an effort to avoid increased fees in 2014.

Reporter Howard Greninger can be reached at 812-231-4204 or howard.greninger@tribstar.com.