It won't be long before insurance companies won't write a policy for the County.
No doubt that the $25,000 deductible was less expensive for the county to pay, rather than fight it out.
Look for insurers to raise deductibles for city and county govts to keep this silly crap from happening in the future.

Also, don't rehire her for any job with the county. After an employee shows the propensity to sue, it should be a red flag for no rehire whatsoever.

And fire the knucklehead that let this situation get out of control.