ORDER N0. 27883
BUDGET RMENDMENT IN
NON-DEF~RRTMENTRL
On this the nth day of December, 2¢~Q~2 upon motion made by
Commissioner Let z, seconded by Commissioner Baldwin, the Cour^t
unanimo~.isly approved by a vote of 4-0-0, to transfer not to
exceed $400,000 from Line Item No. 50-641-200 Indigent Health
Care budget for the p~.~rposes of paying the medical
reimbursement claim that's been presented for the health care
of a per^s on.

MEMO
December 4, 2002
To: Commissioner's Court
From: Tommy Tomlinson
Subject: Budget amendment for meeting of 12-09-02 concerning health insurance.
I am providing this to explain the need for the amendment in advance of the meeting. The amendment is
the result of a health issue of an employee that we should not discuss in a public meeting and the fact that
our policy year ends t2-31-02.
Our current health plan is (mown in the insurance industry as a 12/ 12 plan; ow plan-year is January 1
through December 31. The "12/12" means that our stop-toss carrier (re-inswer) will reimburse us for
claims paid within the policy year. In other words claims incurred during aplan-year but not paid until a
tutwe plan-year will cot be reimbursed by the re-inswer.
The Facts of claim are as follows:
The original claim was approximately $1,000,000.
Ow plan administrator negotiated the claim down to approx. $650,000.
Our stop-loss insurance specified a maximum of $250,000 to be reimbwsed for the medical procedwe.
The $250,000 has been paid resulting in an unpaid amount of approx. $400,000 which is an obligation of
the county. The remaining $400,000 is currently under medical review by our plan adminisrator and the
stop-loss carrier. Ow plan administrator feels with some certainty that the medical review will determine
that part of the cost within the $400,000 is not directly related to the medical procedure.
If we pay the $40Q,000 before 12-31-02 and the medical review determines that part of the costs are not
related directly to the procedwe the re-inswer will reimbwse the county for the amount not related.
If we do not pay the $40Q,000 before 12-31-02 we will have to purchase a "15/12" re-insurance contract for
next year in order to get reimbursed for any of the unrelated costs. The "15/12" means that the re-insurer
will reimbwse claims incurred within the 90 days prior to the end of the plan-year. A problem exist in this
situation; some of the costs were incurred prior to the 90 day period. Also a 15/12 contract for next year
would cost an additional $250,000 in premium.
Please ca0 me if you have questions. Ow plan administrator will be available for questions during court on
12-09-02.