Officials: county has seen 4.2 percent reduction in expenses over five years
While rising state mandated expenses have troubled municipalities, Schenectady County officials feel healthcare costs is one area it has been able to tackle.
Chris Gardner, attorney for Schenectady County, gave a presentation on Monday, Feb. 7, during the New York State Association of Counties 2011 Legislative Conference on a 15-step checklist to reduce employee and retire healthcare costs. The county’s actual healthcare expenses in 2007 was $18,750,610 and the budget allocation for those expenses in 2011 was $17,963,279, which has resulted in a 4.2 percent reduction in expenses over five years.
With the property tax cap coming in I think folks are looking for ways to avoid those double-digit increases in health insurance, said Gardner. `This isn’t anything we just came up with at once, it was over a period of years. It is actually more like 150 steps, but this just sort of distills it down.`
Part of the difficulties with controlling health care costs, said Gardner, is how it is like running on a treadmill, because the costs are always growing and speeding up. The overall inflation rate for health insurance is at 11 percent a year, he said. If the county followed the trend of an 11 percent yearly increase, he said the county tax rate would be 17 percent higher than it currently is and an additional 10.5 million in expenses would be incurred a year.
`I think we are about the only municipality in the state that has reduced our health care cost in the past five years,` said Gardner. `Our legislators work on this and put a lot of effort into making sure we arte taking advantage of every possible opportunity out there.`
Using a Canadian prescription drug program has been highlighted before as one of the different ways the county has been able to achieve savings. Gardner said the county’s prescription drugs costs have increased by 15.9 percent from 2005 to 2010.
Gardner did a cost comparison of the top 10 purchased prescription drugs in county healthcare for the third quarter in 2009 between Canadian drug program prices and United States drug prices, which showed a difference of $1,956.42 more for U.S. drug prices. The costs of those 10 drugs also were 107 percent higher than the Canadian drug program prices. Another way the county has looked to save money on prescription drugs is through mail orders, which have increased from less than 1 percent to 60 percent since 2004.
Some local municipalities have had difficulties negotiating with unions, but Gardner said the county has been able to make progress with unions by explaining why changes were necessary.
`We are going to try to lead the way in health insurance reform and it hasn’t been at the expense of the quality of the health care that we still have,` he said. `We have worked at it in a cooperative fashion with our unions and it truly has been a partnership with our unions. We found that it is more useful to try to explain the reasoning behind things and why it is in their interest to participate in some of these reforms and a lot of time the unions have good ideas that are incorporated into the plans themselves.`
Focusing on wellness is an area the county invests into for long-term savings. Every county employee is given a $400 credit towards a YMCA membership, which has over 300 participants. Another option for those wanting to use their own gym is $240 net bonus if they make 100 or more gym visits to non-YMCA facilities.
`It reduces the likely hold of having those major cost drivers,` said Gardner about the wellness aspect.
The county is trying isn’t to hide its methods either, he said, because implementing these across the county and the sate will help lower expenses for everyone.
`We are not trying to keep it a secret we are trying to help out as many of our public employers because we all will benefit if we have a lower tax rate,` he said. `If all our municipalities were able to do the same thing I think the savings would be closer to a 100 million.`
Over 50 percent of Gardner’s time he said was spent working on something related to health insurance and he credited the county’s vigilance towards finding ways to lower costs.
`If you keep on top of it you can make real progress and we have worked hard and we have a great financial team.“