Lake County employee health insurance contribution to increase

A plan by the Lake County Council to increase employee health insurance premiums will raise the monthly contribution for county workers for the first time in 10 years.

The plan is one of two that impacts employee benefits and involves cost increases to employees. The increases were described as overdue and needed to keep the plans solvent.

A second proposal increases contributions for members of the police pension fund and the county due to adjusting the mortality table figure used to calculate contributions for the first time in 40 years.

Councilman Dave Hamm, D-Hammond, said employee insurance premiums have not been adjusted in 10 years.

“I think it is important to note (the increase) was proposed higher, but we’ve chosen to bring it down,” Hamm said.

The change will raise the premium rate for a retired employee under the age of 65 from $200 to $240 a month, according to council consultant Larry Blanchard. The premium for single individuals will go from $125 to $150.

Council President Ted Bilski, D-Hobart, said the group has worked over the years to sustain the best health care with the least amount of out-of-pocket expenses for workers. He said even with the increase in premium costs, the insurance is well under the area standard cost.

He said while it may seem like the council provided employees with a 5% pay raise in 2023 only to take on additional costs to insurance, workers will still come out ahead.

“Even with that premium increase, it is still a substantial pay increase,” Bilski said. “We are trying to make the best move we can to keep the plan solvent and provide everybody the best health care we can.”

Bilski said the council may need to look at adjusting pay on the lower end of the spectrum in its workforce in 2023 since those workers will be hit hardest by the insurance premium increase.

Christopher Dilts, with corporate benefits consultant Dilts & Associates in Merrillville, said the police pension plan’s mortality table needs to be updated because people are living longer than when it was put in place and plan funding doesn’t account for that increased life span. He said contributions also should have been adjusted with each approved salary increase over the years.

The plan was put into effect in the 1980s and is more than 40 years old, he said. It should have been updated incrementally over the years, which would have gradually increased contributions. Dilts said every other pension is using the current table approved by the federal government The county needs to work toward implementing the current table.

According to a report prepared for the council, the sheriff’s department and the pension committee have been actively managing the pension benefits, costs and investments. From 2015 to 2023, not only has the county’s pension contribution not increased in line with salary increases, it has reduced in actual dollars, according to the report.

The 2022 and 2023 contributions are approximately $300,000 less than 2015 and more than $400,000 less than in 2017, according to the report. Now that the rate must be raised, he said they are trying to figure out how to do it as cost neutral as possible. The proposal is to use a combination of the new mortality table and a higher interest rate.

The council will consider the measures Tuesday at their regular meeting.

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