Health care costs are out of control, according to Kenai Peninsula Borough Mayor Mike Navarre.
Speaking at the Kenai and Soldotna joint Chambers of Commerce luncheon Tuesday at the Soldotna Regional Sports Complex, Navarre stressed the importance of finding a solution to rising health care costs.
“We’re spending a ridiculous amount of our GDP at the national level, and our resources at the state level on health care,” Navarre said.
Navarre said that since 1999, borough wages have increased 86 percent. However, health care costs have gone up 330 percent in the same time frame.
“You should be shocked,” Navarre said. “I am.”
Navarre said one explanation as to why the borough spends more and more in health care costs each year is growing costs of the borough’s previous retirement system.
“It resulted in a huge unfunded liability in large part because people are retiring earlier and people are living longer,” Navarre said. “Perhaps more importantly we grossly underestimated the cost of retirement program health care.”
To help reduce health care spending, the borough assembly has recently appropriated $200,000 to form a task force with the mission of lowering borough health care costs.
Navarre said that one of the first things he would like the task force to look at is adopting hospital and health care power on a borough-wide basis.
Navarre said that by combining the Central Peninsula Hospital and the South Peninsula Hospital into one entity, it would provide a more efficient system.
Giving the borough health care power would also result in increased taxes for some central peninsula residents, Navarre said, but it would equal out taxes borough-wide. Central peninsula residents would get some relief, however, when using the hospital or other health care services, he said.
Navarre said he would like the task force to form within 60 days, and that he would like the choice of whether or not the borough should adopt health care powers or combine service areas on a borough-wide basis to be on the October ballot.
“I want to be completely transparent about what the impacts are,” Navarre said.
While the first steps to lower health care costs are being taken, Navarre said he wasn’t happy about the speed at which things move.
“It’s slower that I would like it to be,” Navarre said. “I also think that waiting for them to figure it out at the federal level and then telling us how we’re supposed to do things — we might be better served if we develop what we might think our vision is for our communities and then fit our model into whatever is available at the federal level.”
Reach Ian Foley at firstname.lastname@example.org.