Over the summer, health departments across the commonwealth were given a one year reprieve before seeing an extreme hike in their pension contributions in the hopes something would be done.
With time dwindling down for action, several bills have been introduced in the state House of Representatives, which lawmakers think could help the situation, but local health department officials say otherwise.
Nancy Crewe, director of the Madison County Health Department (MCHD), said that both bills would create winners and losers among local health departments.
One of those proposed bills is House Bill 171, which would require a 100% employer match to the pension system divided evenly over the next 27 years and is referred to as “level dollar funding.”
In an article from Kentucky Health News, bill sponsor State Rep. Jim DuPlessis, R-Elizabethtown, explained that, “You pay what you owe, no more, no less.”
The bill would require all new employees to have a pension obligation of 10.35%, dubbed the “normal cost,” essentially giving departments two pension bills to cover their costs. One for the unfunded liability of current and past employees and the other, for new ones.
Another sponsor of HB 171, Rep. Joe Graviss, D-Versailles, agreed with Crewe verbatim, saying the bill would see both winners and losers.
According to Crewe, the MCHD’s pension obligation under HB 171 would increase by $1.86 million, which would consume 36% of their budget strictly to pensions.
“The bill is detrimental to MCHD’s capacity to support enough employees to provide adequate public health services to a growing Madison County,” she told The Register.
Already, she reported, the MCHD has cut services in response to the pension crisis by cutting 21 positions from December 2017 to December 2019.
Another proposed bill regarding health departments’ funding, is House Bill 129, which would introduce a new, “more equitable” formula which would take into account the department’s ability to generate funds.
Simply put, departments that have more resources would get less state funding under the model, including Madison County, which would stand to lose $116,113 based on early estimates.
In a spreadsheet prepared by Kentucky Health Department Association President Allison Adams, it is estimated that 14 of the 61 county and district health departments would get less funding and the rest would get more.
This is done with a formula based on the county’s population, its ability to support its health department with its current taxing authority, how many employees the county would need to provide only health services required by law and an estimated increase in environment fees.
Other than Madison County, the 13 departments that would get less funding are in Breathitt, Bullitt, Clark, Fayette, Franklin, Johnson, Knox, Marshall, Montgomery, Oldham, Whitley and Woodford Counties, along with the Wedco District Health Department who services Harrison, Nicholas and Scott Counties.
Unlike those departments, other health departments which serve multiple counties, would get the largest increases from HB 129.
One for example is Lake Cumberland, which serves 10 eastern counties, would have the largest increase with their budget rising $1,377,842.
In a separate article published by Kentucky Health News, Dr. Kraig Hambaugh, director of the Lexington-Fayette Health Department, said the numbers in the spreadsheets are estimates, most based on assumptions.
And while his department stands to lose over $1 million, Hambaugh said he still supports the bill.
“This shouldn’t turn into an us-versus-them kind of game, one health department versus the other, because we’re all part of one larger system that is designed to promote health in the commonwealth and to protect the public’s health,” he said in the article.
Crewe said that neither of these bills will help with the basic problem of the public health funding shortfall.
“HB 129 creates financial winners and losers among local health departments,” she said. “It does not fix the root cause of the public health funding shortfall, which is the pension crisis. Adequate funding of pension contributions for all (local health departments) would make HB 129 moot. Every (local health department) should be a winner, and we all would be winners with adequate pension funding.”
Reach Taylor Six 624-6623 or follow her on Twitter at @TaylorSixRR.