Situation: Chambersburg, the county seat of Franklin County, Pennsylvania is the historic and commercial center of the region characterized by varied small and medium industrial enterprises. It is a rich agricultural and residential area. The Borough provides benefits for 176 employees that service the community.
Challenge: The Borough was facing challenges in the fully insured market place. The cost to provide benefits was continually increasing and there were limited options for the Borough to consider because of their union contracts.
Solution: In 2006, the elected officials of the Borough agreed to join the PA Municipal Health Insurance Cooperative which allowed them to provide their health insurance benefits in a self-funded arrangement without the risks normally associated with self-funding. This is an option that would never be safely available to this size employer in the traditional marketplace.
Results: This Borough has received a surplus distribution for each year of their participation in PMHIC totaling $12,750,351. These surplus monies would have been kept by the insurance carrier had the Borough remained fully insured. Instead, they were able to be distributed back to the Borough to assist them with their fiscal obligations to their taxpayers.
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