Oro Valley Proposing To Self Insure Employee Medical

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One of the creative aspects of 2012-2013 Oro Valley Budget is self insurance of the town's medical plan for its employees. This is something that  Saharita, did.  It is a means of reducing employee benefit costs while providing the same level of benefit.

The town Council will be discussing this program at Wednesday's Town Council Meeting. The item is included on the Council's consent agenda. As it has been barely discussed in public, we are hopeful that the item will be "pulled" from the consent agenda and added as a regular discussion item.

We asked our top Financial Advisor, John Musolf, to take a look at self-insurance and give us his insight on how it would work and what it might mean for Valley.   John prepared the following "tutorial" to bring us all "up to speed."
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Health Insurance is similar to Life Insurance, but the risk of the insurer obtaining profits is greater. Insurers set higher premiums for health coverage from the employer. The insurers still expect to make a profit. If the health claims of the clients exceed the premiums collected it will result in losses for the insurer.

When a private company or government entity wants to self-fund health insurance it is betting that it will be able to control the difference between the money (fund) set aside from the general fund (in the case of Oro Valley) and claims actually submitted by employees. It is not trying to make a profit but break-even and thereby lower its cost.

However, a private company or government entity that wants to self-insure must protect itself totally from any losses. 

Here's what Oro Valley plans to do:

•    The Town is considering buying Third Party Administration (TPA) called Administrative Only Services (ASO) from a subsidiary of United Healthcare called UMR so that it will not have to incur new budget costs in setting up its own internal administrative services.

•    The Town plans to contract with United Healthcare in the form of a plan called High Deductible Health Plan (HDHP).  In this way, the employees will still have access to a provider Network for basic health insurance protection

•    The Town will "lay-off "some of the risk of excess or catastrophic health claim problems by buying stop/loss insurance. This is called re-insurance. The Town is considering buying that service from United Healthcare.

•    The Town will also continue to provide prescription or drug coverage, by considering buying that Pharmacy Benefit from a subsidiary of United Healthcare called Optum.

Arizona has a state law that allows someone to directly sue an insurer (Town of Oro Valley) for errors and omissions in claims problems. The Town of Oro Valley may already have liability insurance that covers this potential problem. The Town may have to purchase liability insurance to protect itself if it does not.

John Musolf
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Mark Napier: Candidate For Pima County Sherriff

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The following is a message from Mark Napier. Mark is announcing that he is a candidate for Sheriff of Pima County. Mark's outstanding background in criminal justice, both as a law enforcement officer and an instructor at Boston University, makes him uniquely qualified to be Pima County Sheriff.

As you know, being elected to office requires more than simply being qualified. One also must have the personality and character to be likable; and the convictions to "stand tall" when tough decisions must be made.

We have had the opportunity to meet with Mark during and after the recent Oro Valley primary elections. Mark has all of these characteristics. He will do a fine job as Pima County Sheriff.

Here are Mark's words.
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"Hello my friends.

I am sorry that I have been away from the blog for a while.  Life has taken a new, unexpected and exciting turn for me.  After a lot of discussion with my family and several friends in the Republican Party, and even my good friend Richard, I have decided to enter the race for Pima County Sheriff.  It is late in the process and it will be an uphill climb, but I am convinced it can be done.  Moreover, I am convinced that I am the candidate that can defeat Dupnik in November.

Many of you know my background in law enforcement and I think most of you know my sustained commitment to public service.  I came to realize that the office of Sheriff is my calling.  Our community can simply not afford another four years of Dupnik’s leadership, or the lack thereof.  I know that we may have had our differences in the past, but I am hoping that all of you will support my run for Sheriff.  You have my word that I will restore leadership and pride to the Pima County Sheriff’s Department.  Please visit my website at marknapier4sheriff.org.

I would be remiss if I did not close in saying a few words about Oro Valley.  My love for this community, my home, is unabated.  I hope that as we move toward seating a new Council that we can keep the tone of our discourse positive.  I have noticed that Richard has taken a more positive tone and I am so pleased by that.  We can and should disagree.  It is the manner in which we disagree that can be positive and constructive, or negative and destructive.  We should challenge the things that we see as wrong and hold all elected officials accountable.  The greatest challenge to what is wrong is the light of thoughtful scrutiny, as what is wrong cannot stand the positive light of public scrutiny.  When that scrutiny turns negative, it becomes the focus and the wrongs are seldom addressed.  Just my closing thoughts."

Mark Napier
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