The Clinton Herald, Clinton, Iowa

Local News

October 20, 2012

Clinton city workers’ insurance costs on agenda

CLINTON — The Clinton City Council during a Committee of the Whole meeting Tuesday will discuss two benefits changes facing city employees.

The proposed changes to non-bargaining employees’ insurance have been altered since they were first proposed last month as a result of City Finance Director Jessica Kinser and Tim Kearns with RJ Lee and Associates meeting with the affected group.

During those meetings it was realized that the proposed high-deductible plan with a health savings account would not work for all employees whose plan would change.  Instead, Kinser is recommending two options be available. The first, a HDHP/HSA plan would have deductibles of $2,500 for a single person and $5,000 for a family.  The second option, a PPO, would offer a $1,000 deductible for singles and a $2,000 deductible for a family.  

The proposed changes only affect non-bargaining employees because contracts for bargaining employees are already in place. However, Kinser said if the changes are approved she recommends language be included that would dictate a review of non-bargaining employees’ insurance when contracts with bargaining employees are being negotiated.

The non-bargaining employee benefit changes will need to happen by Jan. 1, 2013 because the proposed plans involve increasing deductibles that run on a calender year.  

Non-bargaining employees were happy they will have two options, Kinser wrote in a memo to the mayor and City Council, but did not support the change taking place Jan. 1, 2013 or the fact that it will impact only non-bargaining employees.

The changes were sought due to escalating insurance costs.

This year, the city had a 28 percent increase in health insurance renewal, and the cost per employee was $17,758 according to a cost/plan design survey. The industry average is $10,612.

The renewal percentage also was higher than the national average of 4.9 percent.

Demonstrating further need for action, Kinser said, is a summary of plan performance the city received that showed the total cost of the plan through the first three months of fiscal year 2013 were higher than the first quarter of fiscal year 2012.  

The Committee of the Whole will also consider offering all employees a cash incentive if he or she chooses to waive the city’s insurance.

As long as the employee had proof of other insurance coverage, he or she could opt out of the city’s coverage and receive a one-time annual cash incentive. The Internal Operations Committee suggested this incentive be $1,500. However, Kearns suggested it fall between $750 and $1,000.  

The amount, if any waiver is approved, will be decided by city council members.   

The COW meeting will take place immediately after the City Council meeting at 7 p.m. Tuesday at City Hall.

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