New Albany, MS- During the coming year Union County taxpayers will spend $260,198 less for health insurance coverage for county employees than they paid during the last 12 months.
It was the first time in at least a dozen years that the county board invited bids on its employee group health insurance from more than one insurance agency. For at least that many years the Morgan-White Insurance Agency of Oxford has sold the county its health insurance for county employees.
During that time the Union County Board of Supervisors did not advertise for bids on health insurance — no request for bids as is generally the case with most other purchases.
State law does require county and city governments to advertise for and receive bids to buy road equipment, law enforcement vehicles, fire-fighting equipment, etc. Open bidding is required on most county construction projects such as roads and bridges. However, advertising for bids is not required by state law and had not been done in Union County for insurance purchases..
New Albany insurance agent John Stroud spoke to the county board at its January 23rd meeting and, on behalf of himself and several other agents, asked for the opportunity to bid on the county employee health insurance
Stroud said that he and the other agents, who appeared with him on January 23rd, were licensed to represent Blue Cross, Humana, Aetna, Star Mark, United Health Care, etc., the same companies represented by Morgan-White. The Board of Supervisors welcomed the bid from the group.
Besides the John Stroud Agency, Shanda Williams of the Affordable Benefits Agency and agents Scott Hancock and Bill Turner were represented by Stroud in that January 23 meeting. All are Union County residents.
The winning bid submitted by this group of agents will provide Blue Cross/Blue Shield to more than 100 Union County employees. The Board of Supervisors accepted the money-saving bid at a meeting on Wednesday, Feb. 22. The other agency that bid on the county health insurance for the coming year was Morgan-White.
In addition to saving county tax payers more than a quarter million dollars compared to last year, the new insurance plan will lower the deductible for each county employee from $1,000 to $500 and will reduce the out-of-pocket expense from $1,500 annually to zero.
“We are very pleased that opening up the bidding saved the county money while improving coverage for our employees,” said Dave Kitchens, president of the Union County Board of Supervisors.
Kitchens said 108 county employees currently have health insurance. The county pays 100% of the premium for its eligible employees. The employee pays for any dependent coverage.
The current county board took office early in 2016. Four of the five board members sworn into office in January 2016 had not previously served on the board.
“We wanted to let other people bid on the insurance when we came into office last year, but we were just learning the ropes, the renewal date was almost upon us, and we decided it would be best to leave it with Morgan-Stanley at the time,” said Kitchens. “However, we agreed then that we would put it out for bids this year.”
Union County Administrator Terry Johnson told NAnewsweb.com , “Off the top of my head, I’d say we’ve been with Morgan-White about 15 years.” Johnson also said, “insurance is exempt from bidding” under Mississippi law. Although local governments are not required to put insurance coverage out for competitive bidding, they may advertise for and receive bids if they choose to do so.
Johnson said that in the earlier years of his tenure as county administrator insurance companies would require the county to provide an “agent of record letter” before preparing a bid for any of its agents to submit.
The insurance companies did not want to get caught in the middle of a bidding war between two or more of its own licensed agents. That had the effect of discouraging bidding. However, the requirement by insurance companies of “agent of record letters” ended some years ago.
Courthouse sources told nanewsweb.com that the savings in employee health insurance might help avert an increase in property taxes.
During the coming 12 months the county will pay $850,824 for health insurance for 108 employees. Last year the total of health insurance premiums paid was $1,111,022.
Stroud and his associates’ appearance before the board a month ago: http://nanewsweb.com/union-county-insurance-rural-internet-service/