When Miami-Dade County’s new budget year begins Wednesday, more than 100 workers will remain on the payroll thanks to a planned redesign of the county’s employee healthcare plan that Mayor Carlos Gimenez hopes will deliver as advertised.
Success will depend on the Gimenez administration’s betting correctly on a range of factors, including how costly employee medical expenses will be next year. The mayor’s financial team expects the new plans to save Miami-Dade about $50 million during the new fiscal year.
County commissioners are slated to approve the framework of the new plan Friday, along with five union contracts that are key to making the 2015 changes. But while the union compensation is detailed, employees’ healthcare expenses are harder to predict.
Among the unknowns are future consumer behavior. Will Miami-Dade employees, retirees and dependents choose lower-cost settings, such as urgent-care centers, over higher-priced options such as a hospital emergency room?
Digital Access For Only $0.99
For the most comprehensive local coverage, subscribe today.
Another unknown: The number of Miami-Dade employees who will enroll in a new health plan called Select Network that reduces costs by offering fewer hospitals and doctors who can then reduce their prices in exchange for the prospect of a steady stream of county patients.
An early barometer will be the upcoming open-enrollment season, when roughly 25,000 full-time county employees will choose a healthcare plan.
Gimenez is counting on the savings to fund dozens of civilian police jobs and about 70 other positions slated to be cut in the budget adopted last week. In the police department, the savings would pay for 42 civilian positions. For the parks department, it would fund another 42 positions.
Gimenez also plans to use healthcare savings to expand hours at the county’s 311 call center, fund 12 positions there and keep three walk-in offices open. And his promise to restore maintenance workers for county roads also depends on the projected savings.
The savings would pay for 15 public-works employees otherwise set to be cut in the 2015 budget, along with two guards for the youth Boot Camp that Gimenez spared before commissioners adopted the $6.2 billion spending plan.
Miami-Dade is counting on a significant number of workers to stick with the pricier HMO and POS plans that will mean premium revenue for the county.
The county has proposed a new biweekly premium for employees who currently pay none and increased premiums for others. There are also new and higher co-pays for services under those pricier plans, such as a $200 fee for inpatient hospital admissions.
The Select Network plan is the only one of three health plans proposed for Miami-Dade employees next year with no monthly premium for single coverage, and the lowest premiums for dependent coverage. Select also has fewer co-pays for medical services than the other two options, an HMO and a POS plan.
Over the past month, Gimenez has made it less likely that more employees will stick with their old plans by announcing the addition of even more hospital systems to the Select plan’s network: University of Miami Health System and Miami Children’s Hospital.
Terry Murphy, a union consultant whose wife is a county employee, said he believes most Miami-Dade workers will choose the Select plan given the plan’s lower out-of-pocket costs and network of hospitals and doctors.
“It’s a very attractive alternative,” Murphy said. “By adding University of Miami hospitals and clinics, and Miami Children’s Hospital, most county employees are going to do the math and realize, ‘Look, it’s very similar service, and a lot less out of my pocket.’”
By adding providers, Miami-Dade risked losing the lower rates offered by the plan’s original hospitals, which were motivated to reduce prices with the expectation that they would receive more patients covered by the county plan.
Mike Hernández, a spokesman for the mayor, said the county stands by the projected healthcare spending reductions — even with the addition of new hospitals to the Select plan.
“AvMed was asked to work to secure UHealth and Miami Children’s Hospital in the Select plan in a manner that would have a neutral impact to Miami-Dade County’s projected savings,” Hernandez said in a written statement. “One of the hospitals came in slightly higher than our consultant originally projected, while the other came in slightly lower than was projected. ... We are confident that the projections are solid.”
Corey Miller, a spokesman for AvMed, also issued a written statement that said the hospitals and doctors in the Select plan agreed to “work collaboratively” to achieve cost reductions.
“We were able to reach agreements to add UM and Miami Children’s facilities to the network,” Miller said in the statement, “while maintaining the entire original list and protecting the associated cost savings.”
Gimenez’s budget chief said the spending plan does not fully reflect cost and use estimates from the county’s actuary firm, Gallagher Benefit Services. Budget director Jennifer Moon told commissioners earlier this month that Gallagher usually delivers forecasts for healthcare expenses that are “higher than what actually occurred” in recent years.
“If we went with them, we would actually have to ultimately reduce even more positions in the county budget,” Moon said at a special healthcare meeting Sept. 10. “In order to balance out their extremely, extremely conservative estimates and what we see as actual activity, we ... come up with something that more mirrors what is actually going to happen.”
The remarks followed objections from Commissioner Bruno Barreiro, a former state lawmaker, that Miami-Dade was not fully accepting Gallagher’s forecasts. “What concerns me is how we are budgeting our money,” Barreiro said.