In response to several complaints over a new health insurance policy, Mobile County announced last week that all employees covered under its Local Government Health Insurance Plan would be extended a $750 line of credit through Rite Aid Pharmacies regardless of their credit history.
The decision came about three weeks after 600 county employees filed a grievance with the commission over the new plan, which took effect in April.
Though several problems were discussed during a recent public meeting, the most were related to point of sale costs for name brand prescriptions.
After meeting a $200 major medical calendar year deductible, employees will be reimbursed for 80 percent of their name brand prescription costs. However, some employees reported paying as much as $1,100 per month and then waiting up to two weeks for their reimbursement.
“We heard loud and clearly how that was a heavy burden on a number of people,” Commission President Connie Hudson said. “We’ve reached out to a number of pharmacies, but Rite Aid was the first to step up. We think it will go a long way in alleviating that point of sale cost.”
Joe Westfall, a district pharmacy representative with Rite Aid, said county employees would essentially be getting a Rite Aid credit card with a $750 limit — a program the pharmacy also extends to certain private businesses.
According to Rite Aid’s website, there are nine pharmacy locations in Mobile County.
Though he couldn’t give the interest rate when asked by a member of the audience, Westfall did say that additional credit above $750 could be possible while employees wait to be refunded through the LGHIP.
Two sergeants with the Mobile County Sheriff’s Office, a group that has been very vocal in its opposition to the LGHIP, expressed disapproval of the proposed credit program with Rite Aid.
“These employees haven’t had raises in several years, and adding a line of credit is only compounding the problem,” Sgt. Phillip Mayo said.
Sgt. Richard Cayton said the credit line would charge interest and create “one more cycle for employees to go through” to get the medicines they need.
Despite some disappointment with the credit line solution, employees did get a first look at how the county might break a seven-year trend of stagnant wages.
“Our highest priority as we worked on [the budget] was to find a way to provide salary increases for all employees, and we have achieved that,” Finance Director Michelle Herman said. “This current recommended budget contains a salary increase of 2.5 percent effective in the first pay period of October 2014 and an additional salary increase of 2.5 percent in April, 2015.”
The pay raise will cost the county approximately $2.3 million per year once both raises are added.
Herman said the commission would determine the type of raise implemented, but also said most of the administration is leaning toward a cost of living adjustment across the board — a sentiment County Engineer Joe Ruffer objected to.
“We feel very strongly that there should be a set dollar amount for every employee,” Ruffer said. “Employees making around $40,000 a year, around 70 percent of our total employees, would benefit more from a set hourly increase than they would from a percentage increase across the board.”
Ruffer said a comparable 50-cent hourly raise would increase some of the lowest-paid employees’ salaries 9 percent, and only increase the county’s highest salaries by 1 percent.
Hudson said those types of raises ultimately end up compressing the existing salary ranges. Ruffer did not disagree, but said it would only affect the salary range once.
“The people at the bottom of the pay scale absolutely need the most help,” Ruffer said. “I don’t think people have a problem hiring and retaining employees at $50,000. It’s the lower, simple skilled jobs that we can’t hire, and those are the ones that we’re losing.”
As he has in the past, Sheriff Sam Cochran said the problems with compressed salary ranges would persist until the county begins using a merit raise system, which would allow departments to award raises for performance and experience in a certain position.
Though the commissioners agreed, Jerry Carl said it would be impossible to address the problem during the current budget deliberations.
“As soon as this budget is through and the ink’s dry, we need to start looking at that,” Carl said. “We’ve got to catch some of these salaries up to the (private sector), but we can’t do it a month before the budget.”
Even with the planned salary increases and talks of merit raises in the future, some employees still weren’t happy with what the county brought to the table.
“We appreciate the raise, but we’re still behind,” Cayton said. “Most people’s cost of living went up 6 or 7 percent because of the new health insurance policy. We’re still in the hole.”
The budget hasn’t been officially approved, but it is expected to be taken up at the commission’s Sept. 19 meeting.
During a presentation to county officials, Herman said revenues are projected to be higher than anticipated — nearly $123 million. Sales tax is expected to bring in $52.5 million, which is up about 3.4 percent from original projections.
“The increase in revenue is coming primarily from a very small increase in property tax,” she said. “The rise in sales tax is a combination of both increased collection and growth in the economy.”
Also discussed for the first time, was a plan to balance the proposed budget using around $1.1 million from the tobacco tax fund. More than $3 million was pulled from the fund to balance last year’s budget.
Personnel expenditures for the 2015 budget are up from $66.7 million to $68.3 million, which Herman said is a result of the expected pay raises.
However, this year’s operational budget is down .79 percent to about $37.5 million. According to Herman’s report, most departments will likely keep level funding unless there is a specific reason for a decrease.
“We realize there are some instances where there will be a need to increase those budgets during the year, but because our main goal here was the salary increases, we did not address those in the operating budget,” Herman said. “Those will be addressed as we close out the end of the year and see what funds are available to carry over.”
Herman said the finance department won’t know what carryover funds are available until December. She also said that would be entirely dependent on how much department supervisors spend from the funds they have budgeted currently.