Union: LGC is late returning surplus funds
CONCORD — HealthTrust, a former subsidiary of the New Hampshire Local Government Center, will complete the return of $20.8 million in surplus funds from 2011 by August 2014, sparking protest from the firefighters union that has been largely responsible for forcing the public insurance administrator to open up its operations.
So far, HealthTrust has returned about $16.1 million and HealthTrust Executive Director Peter Bragdon said the remaining payments totaling about $4.7 million will be made to the two risk pool groups HealthTrust manages in February and August of next year.
David Lang, president of the Professional Fire Fighters of New Hampshire and a frequent LGC critic, said the extension violates a state hearing officer's order and questioned why HealthTrust has extended the payments.
"I think the taxpayers who paid excess money in 2011 and have to wait almost three years to get their money back should be outraged," Lang said.
Bragdon said the payments will be made within guidelines adopted in a resolution by the HealthTrust board in October 2012 that say the returns must be made "over a two-year period."
"I guess you could say that between October 2012 and October 2014 that the payment has to be made," Bragdon said. "I can't really see any other reading of it."
However, the order, issued two months before the board's resolution, said surpluses "shall annually be returned."
Bragdon, a state senator who took the HealthTrust job in August, said he couldn't answer why the board's resolution didn't match the order.
"I don't know why that decision was made," he said. "I can't comment on it, not being there at the time."
However, he said, the $16.1 million, along with rate reductions totaling about $5.6 million done in 2012 to return 2011 surpluses, brings HealthTrust's surplus cash for 2011 below the order's requirement of the lower of 15 percent of claims or risk-based capital ratio of 3.0.
Lang, whose decade-long Right-to-Know battles with LGC resulted in a state Supreme Court decision in 2010 that ruled LGC was a public body subject to open government laws — questioned why HealthTrust didn't simply return all of the money when it made large payments to all of its members last August and why it held back $4.7 million.
"The fact is, there is $4.7 million that hasn't been returned to the taxpayers, active and retired employees," he said. "We're not talking about $4.70. We're talking about $4.7 million."
Bragdon, said he didn't know why the payments were not all made last year.
"I can't answer that as to why it wasn't changed" so the balance was paid in August, he said.
LGC is under a state hearing officer's order to return a total of $53 million in further surpluses to members. It has appealed the order to the Supreme Court, which will hear oral arguments in the case on Thursday.