In an effort to save money for local municipalities and improve the health care of their employees, a plan that was presented on Thursday to the East Hampton Village Board would merge local towns and villages under one cooperative health plan.
The plan, the East End Cooperative Health Plan Initiative, has been discussed by the East End Supervisors and Mayors Association since last year as an alternative to the New York State Health Insurance Program and is intended to stabilize the municipalities’ long-term costs while promoting better patient care.
If implemented, the plan would be open to the various towns, villages, school districts, libraries and fire districts across the East End.
According to J. Scott Bradley, who is helping to formulate the plan and is a senior vice president of the insurance and risk management firm Cook, Hall & Hyde, the first step toward implementing it would be to conduct a feasibility study to help gauge how health insurance could be offered more effectively, while delivering taxpayer sustainability. If the village wants to participate, it would be required to pay the study’s $4,375 entry fee. However, Mr. Bradley pointed out that the fee could be reimbursed up to 75 percent at a later time, once additional municipalities join the study.
“A good question is if there is enough interest to study whether a cooperative would work for the village,” Village Administrator Larry Cantwell said following the meeting as to whether the board would put up the funds to participate in the study. “We will need more information about the study’s steps and its analysis. What will we get for the money?”
He noted that board members asked pertinent questions during Mr. Bradley’s presentation, but he was invited to attend another board meeting in January to participate in a more detailed question and answer session.
Also attending the board meeting presentation by Mr. Bradley was Southampton Village Mayor Mark Epley, who showed strong support for the plan, pointing to the success of other cooperative health plan initiatives throughout the state. Southampton Village was the first municipality to join the study. Mayor Epley, liaison to the initiative and representative of the East End Supervisors and Mayors Association, did not participate in Southampton Village Board’s vote to join the feasibility study due to his role as a leading development partner in the plan.
Encouraging the village, which currently has a $2.1 million health care budget, to sign up for the study in the next 60 days, Mr. Bradley explained that $70,000 is needed to complete the study and submit an application to the New York State Department of Insurance, under the provisions of Article 47 of the New York State Insurance Law. The article allows municipalities to form municipal cooperative health benefit plans in order to share in the costs of self-funding employee health plans.
Mr. Bradley noted following the meeting that “a good example of how municipalities are pulling together to form an Article 47 and save money is in Tompkins County, New York.” Four years ago, 13 municipalities merged to form the Greater Tompkins County Municipal Health Insurance Consortium, Mr. Bradley explained, and after recently receiving their certificate of authority under Article 47, “those municipalities are expected to save close to $900,000 in health benefits costs within the first year.”
To form a cooperative under Article 47, at least three municipalities, with a total of 2,000 employees, would have to agree to participate.