Take a wild guess.
Which was the only municipality in Niagara County to opt out of a money saving, state health care consolidation and the lion’s share of a $15.8 million state grant to bring current costs for municipal employees health benefits back in line?
If you guessed the city of Niagara Falls you would be correct. With the county set to receive about $15.8 million for municipal employees’ health benefits, Dan Engert, Town Supervisor of Somerset, said the goal of a countywide healthcare consortium is to have all municipalities in Niagara County as members — which saves taxpayer money.
“It’s a self-funded program,” Mr. Engert said of the funding, which is coming from the state. “I received informal notice of this in July, but I was waiting for the confirmation letter which didn’t come until the end of August.”
“Healthcare is a tremendous expense in our budgets,” he added. “The timing of this grant is really good. It gives us more time and funding. We have estimates of $22 million in savings,” Supervisor Engert said.
Mr. Engert also said the county is in phase two of the consortium. He said Somerset has received $500,000 to develop a project plan. Once the project plan is submitted and approved, the group is eligible for about $5.5 million immediately. The remaining funding comes in the implementation phase, and they want to move forward with implementation by the end of 2018.
“The goal is to use this money to move as fast as possible to offset costs that are being borne by our taxpayers,” Mr. Engert said. “It’s like a drip, drip funding stream. It’s a consortium that will save taxpayers year after year. This is intended to be the foundation for a program that reaps tax benefits for years to come.”
The plan has been in the works for a long time, and the complete lack of cooperation from Niagara Falls Mayor Paul Dyster hasn’t helped anything, he added.
“We’re trying to put together a program to save our taxpayers money,” Mr. Engert said. “It’s been a long process, but we’re ready to take a stab at it with this funding and bring Department of State revenue into Niagara County. We’ve been working on this for three years now.”
The money comes from a municipal restructuring fund. It has yet to be determined whether the plan would be implemented through Blue Cross Blue Shield, Independent Health or another carrier.
“It’d be a self-funded program. We would solicit carriers through the RFP process,” Mr. Engert said. “That would be during the implementation phase.”
Laz Benitez, public information officer for the New York State Department of State, said in a statement that the Town of Somerset, along with 23 other local governments and school districts in Niagara County, applied to the Local Government Efficiency (LGE) Program in July 2015 for funding to establish a cooperative of local governments in order “to establish a health insurance consortium.”
According to that application, the purpose was to begin to create the inter-municipal structure to share the costs of self-funding health benefit plans, stabilize health claims’ costs and negotiate with health providers by spreading costs among a larger pool of risk.
“At that time, the application noted that the Town of Somerset and its 23 partners spent nearly $50 million to provide employee health insurance coverage, through 50 separate health insurance plans,” Director Benitez said in the statement. “Implementation activities related to the establishment of the consortium began pursuant to the Local Government Efficiency (LGE) grant in March of 2016.”
Why the city chose to opt out of this innovative, money saving plan and forgo as much as $7 million in state grant money is anybody’s guess. No one from the administration will speak to a journalist on the record without the assurance of a cheerleading, “pat on the back” story in return.
So, while taxpayers across the county will benefit from reduced municipal employee health care costs, those in Niagara Falls will bear the burden of a significant tax increase hiding behind the guise of “reassessment.”