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County retirees may get benefit

July 20, 1998|By BRENDAN KIRBY

Washington County employees who reach age 60 and have worked for the county for at least 30 years could retire and receive free health insurance until they turned 65, under a proposal being considered by the Washington County Commissioners.

One of those employees is J. Theodore Wolford, superintendent of the Washington County Roads Department. Under the proposal, Wolford would get free health care for four years, since he is 61 years old an has worked for the county for more than 42 years.

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Wolford said he would not be tempted into early retirement even if the commissioners grant the health benefit.

"I like my job. I like what I'm doing," he said. "I haven't even thought about it."

But the prospect of full or partial health insurance until age 65 might be attractive to some of the other 40 employees who would qualify for the program.

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Human Resources Director Alan J. Davis said an informal survey of retirement-eligible employees showed that many continued working into their 60s because they did not want to lose their health insurance.

Sorting out the potential benefits and costs to the taxpayers led the commissioners to delay passing the proposal last week. They intend to take up the matter again on July 28.

Rewarding senior employees




Currently, the county pays half the insurance costs to employees who retire before age 65, regardless of the number of years they have served.

But the commissioners wanted to give a sweeter deal to the workers who had served the longest while requiring employees to work at least 15 years and reach age 50 before they could get the 50 percent match.

"The benefit to the county is rewarding longtime employees for a job well done," County Administrator Rodney M. Shoop said.

The county offered a similar benefits program for a limited period in 1996 and 1997 in order to reduce the size of the county's work force, Shoop said.

But this would be a long-term commitment.

Predicting the cost of those changes, though, is an inexact science.

Davis said the county might save some money on salaries as older employees leave and are replaced by younger workers who would earn less.

But the change could cost hundreds of thousands of dollars if early retirees suffer catastrophic illnesses or injuries, Davis said.

"We're kind of rolling the dice here. That's the only thing that concerns me right now," Davis said.

It also concerns Commissioners President Gregory I. Snook, who said he wanted to examine long-term cost projections before voting on the matter.

Davis said he would have rough projections by next week, but he cautioned that it is impossible to devise accurate estimates because there are so many variables that could skew the numbers.

If Wolford changed his mind and retired tomorrow, for instance, it would cost the county $3,696 more under the proposed program than it would under the current system.

Davis said the modified retiree health plan could break even in two years.

"That's assuming everyone stays healthy," he said.

If they do not, it could spell trouble for the county. If an eligible retiree came down with a catastrophic illness, the county would be liable for up to $100,000 per year.

The county has a self-insured health system. Costs exceeding $100,000 would be picked up by the county's insurance company, Davis said.

Opposite trend




The proposal to extend full health coverage to senior retirees comes at a time when large employers throughout the country have cut back on retiree health benefits.

According to the U.S. Labor Department, the percentage of retirees who were covered by an employer's health plan declined from 44 percent to 34 percent between 1988 and 1994.

"The trend is away from providing retiree health care. We're kind of going against the tide," Davis said.

Commissioner R. Lee Downey said he would like to see retirees pay a portion of the costs, perhaps 10 percent for the most senior employees and 30 percent for the second tier.

"It would reduce the cost a little bit and make people also appreciate that there is an expense involved," he said.

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