Ament’s Sweetheart Insurance Deal For An Old Crony

Accusations about cronyism in the Ament administration just keep coming. The latest, which I wrote about briefly yesterday, is that the county executive pushed for an ordinance allowing Ament appointees to certain boards and commissions to participate in the county’s generous health insurance and dental insurance plan. One beneficiary was Jeremiah (Jerry) Hegarty, chairman of the county’s pension board, and treasurer for Ament’s campaigns. Yesterday’s brief account of this had some errors. The true story is far more interesting.

Jerry Hegarty’s teenage daughter Sarah suffered a tragic death in 1998 after undergoing three organ transplants and more than a dozen operations. No one knows the total cost of these operations, but one county supervisor estimates the county’s self-insured plan paid out at least a million dollars in coverage. Others say it was higher.

Sarah Hegarty was a terrific athlete and courageous youth who was first treated for large intestine problems in 1995, according to what her father told the Milwaukee Journal Sentinel in a March 26, 1996 article. It was late in 1995 that former head of Human Resources Gary Dobbert, the same man who created the controversial pension plan, introduced a resolution to allow membership in the county insurance plan for Hegarty and others. Dobbert, according to County Clerk Mark Ryan, is the only author listed for this resolution.

Ament is vague about how this measure happened to be introduced. “I don’t recall pushing for this. I don’t recall when it happened. I don’t recall the circumstances.”

But James Lippert, a retired employee benefits analyst who worked under Dobbert, says, “There’s no way Dobbert would have introduced the measure without Ament’s approval.”

The measure was approved on October 27, 1995, by the personnel committee, which was run by former Supervisor Richard Bussler. Bussler is a longtime Ament loyalist who was given a job in the corporation counsel office upon leaving public office. The full board approved the plan on November 2, 1995.

“This kind of thing has been going on forever, because people [on the board] just roll over,” says Supervisor Roger Quindel. “Ament wants, Ament gets.”

If that’s the scenario, then Quindel was among those rolling. The resolution was approved 23 to 0, with two supervisors absent, including current board member Lynne DeBruin.

In passing this plan, Lippert notes, the county board was creating an exception to a longtime policy that only those who worked at least 20 hours a week were eligible for health insurance coverage. The resolution was also unusual in that only certain citizen volunteers were extended this privilege. Of the long list of county boards and commissions, the Dobbert resolution only extended the insurance benefit to five of them: the civil service commission, pension board, veterans service commission, personnel review board and ethics board. Jerry Hegarty, who says he has served on the pension board since about 1993, thereby became eligible for the coverage.

Some members of county boards or commissions are county employees or retirees, who already are covered by the county. Many have a job in the private sector that offers health insurance. Even Hagerty’s cousin Derry, a tavern owner who sits on the county’s Ethics Board, says he did not elect to take the health insurance. In short, the actual number of citizens who elected to grab this new benefit may have been very small.

Jerry Hegarty says he elected to take the county insurance because “it’s more stable” than a private insurer. “I could get it from anyone.” But his wife Dolly does not deny that the family would have had trouble getting private coverage. “So what! We paid for it,” she says.

As of this year, the Hegarty family pays a $972 monthly fee for family coverage with the county. This is far higher than county employees are charged, but the same as what some county retirees (those who have not earned paid-up health insurance) pay.

But Lippert says Hegarty would have had problems getting coverage for his daughter from private insurance companies, because they would not have covered pre-existing conditions. “The county has no pre-existing conditions and no regulations that would prevent somebody with a serious health problem from getting the insurance.”

Jerry Hegarty says its untrue that his daughter had a pre-existing condition, but refuses to say when her large intestine problem first occurred. “It happened whenever it happened,” he says.

A private insurer, Lippert adds, might have disqualified the later operations as experimental. “A really sick person – that’ll blow the figures right out of the water. A private insurance company would never allow that.”

But the county’s plan is far more forgiving. While employees can elect coverage in an HMO, Hegarty instead chose a plan that is completely bankrolled by the county. This plan is administered by WPS, but the county determines the limits of coverage and WPS simply bills the county on a monthly basis for all expenses.

This plan does have preferred providers, but employees need not use them. Sarah Hegarty was treated at a university hospital in Nebraska, among others. All of her operations would have been billed to the county. “The county pays the actual expenses incurred by any member of the plan,” Lippert notes.

“If there are one or two employees who have a transplant, that can have an impact,” says county board analyst Rob Henken. “We can end up with the budget out of whack.”

In short, by taking on an insured like the Hegarty family, the county significantly increased the costs of a plan it self-insures. But supervisors may not have understood this, Lippert notes, because the fees paid by members of the plan are commonly referred to as a “premium.”

“The perception of the board would have been if board or commission members are paying a premium for the health insurance, then who cares?” Lippert notes. But, in fact, the county uses tax levy to subsidize the plan for county employees, and the huge payments for a special case like Sarah Hegarty add costs a private insurer typically would not take on, costs that were recouped from the tax levy.

The story of Sarah Hegarty illness is a very sad one, and one could argue that Ament was simply being compassionate. Jerry Hegarty accuses me of “yellow journalism,” given the tragic circumstances of her death. “Bring her back, pal, and I’ll give the million dollars back.”

“We’re not wealthy people,” says Mrs. Hegarty. “My husband has worked very hard for the pension board and the board has done very well under him. He’s paid $10 a meeting.”

But many citizen volunteers work on governmental boards and commissions without gaining health insurance for a child. Not every county citizen facing a family medical emergency was offered such compassion by Ament. As with the pension plan, the county executive offered extraordinary generosity to certain cronies, with a plan whose import many supervisors didn’t understand.

Finally, I’d like to apologize for yesterday’s story, which erroneously reported that this health insurance plan was offered free and which confused Derry and Jerry Hegarty. The latter is a particularly egregious error for a Murphy to make.

Short Take

Regarding the sources who told me that H. Carl Mueller was providing PR assistance to Ament, Mueller responded today as follows: “I have never worked for Tom Ament or his campaign. I suggest to you that the individual spreading this rumor has a reason to say things that are false, untrue and malicious.”

This article was originally published by Milwaukee World.