Brown Township Payroll Mistake

Out-of-pocket Drug Co-Pays Not an Allowable Employee Benefit

Thursday, July 19, 2012

Columbus –Brown Township (Carroll County) mistakenly approved $5,000 in reimbursements for health insurance expenses not allowed under Ohio law, according to an audit released today by Auditor of State Dave Yost.

Ohio law allows townships either to provide health insurance or instead to reimburse employees for out-of-pocket expenditures for alternative health insurance obtained elsewhere, so long as proper steps are taken. To provide reimbursement, townships must adopt a maximum annual reimbursement amount and reimburse only for actual expenditures that are allowed under Ohio law.

Health insurance, including prescription drug coverage, is an allowable reimbursable employee expense, but prescription drug co-pays are not an allowed payroll benefit.

One employee was reimbursed over two years in the amount of $3,780 for out-of-pocket co-pays, while another employee was paid $1,000 beyond his actual out-of-pocket premium expense. The two employees affected by the mistake have either paid back the overpayments or entered payroll deduction plans to do so.

A full copy of the audit may be found online.


The Auditor of State’s office, one of five independently elected statewide offices in Ohio, is responsible for auditing more than 5,600 state and local government agencies.  Under the direction of Auditor Dave Yost, the office also provides financial services to local governments, investigates and prevents fraud in public agencies and promotes transparency in government.

Carrie Bartunek
Press Secretary