City employees will have a new health insurance plan with lower premiums and, for some, higher deductibles in 2014.
At a special meeting on Tuesday, Oct. 22, the New London City Council voted 8-0 for a plan offered by Network Health.
Council members Lori Dean and Dennis Herter were absent. Health insurance was the only item on the agenda.
LuAnn Boyea, of Associated Financial Group in Kimberly, presented three insurance options from Network Health, based in Neenah-Menasha, and one from the WEA (Wisconsin Education Association) Trust.
The WEA plan had higher deductibles and out-of-pocket maximums.
Boyea, city treasurer and finance director Judy Radke and Steve Thompson, director of New London Utilities, considered many plans, discarding those that didn’t come close in coverage, Radke said on Friday, Oct. 25.
The city went looking for new health insurance after its existing insurance company folded, according to Radke.
The Network Health plan includes:
• Deductibles of $2,000 for single coverage and $4,000 for families.
• Monthly premiums of $493.51 for single coverage and $1,389.01 for families. These premiums are less than under two plans currently offered by the city. Employees now pay 4 percent of the premium; the city pays the rest.
• Caps on out-of-pocket costs of $2,000 single, $4,000 family for in-network care; and $3,000/$6,000 for out-of-network care.
This year’s premiums are $592.46 for singles and $1,667.52, family, for city employees; and $560.34 and $1,577.11 for utilities employees. The plan for city employees has deductibles of $1,500 and $3,000; the utilities plan, $2,000/$4,000.
How much the city will pay toward the monthly premiums and deductibles in 2014 will be discussed at the November Finance Committee meeting, according to Radke.
The current employee 4 percent amounts to $23.70 or $22.41 for single coverage; $66.70 or $63.08 for family.
The city also currently pays 60 percent of the $1,500/$3,000 deductible, with the money deposited into the employee’s Health Savings Account. It can be spent only on health care costs.
Four percent of the new monthly premiums is $19.94 for single coverage; $55.56 for families.
Radke said the city would be looking to increase the employee portion of premiums as time goes on, perhaps to 10 percent.
She said 55 city and utility workers are covered under the current health plans.
The Network Health plan includes an optional second year of coverage with a maximum rate increase of 10 percent.
The contract does not bind the city to a second year. Radke said the city would be free to shop around and negotiate for better rates.
She estimated the city would save $9,000 in 2014 over the cost of insurance in 2013.
Retirees
The new plan will not cover five retired city employees who now have health insurance through the city. Radke said the city does not contribute any funds toward those insurance costs.
With health care reform, Boyea said, the city will be able to help retirees find other coverage.
She noted that under the Affordable Care Act, there no longer is underwriting, which considered a person’s health and pre-existing conditions. Boyea said retirees should be able to find options similar to their current coverage.
“We will work with them, help them find another plan,” Radke said.
The new plan includes ThedaCare and Affinity health care providers in New London and the Appleton area. It does not include Walgreens for prescription drugs.
The plan includes some wellness incentives that can save money on premiums for employees, according to Boyea.
“Insurance is very, very interesting, due to health care reform,” she said.
Mayor Gary Henke said Boyea would meet with city employees to explain the new health insurance.
“You already have a high deductible in place,” Boyea said, adding that would make it an easy transition for employees, who will pay less money out of pocket for premiums.
The city also will provide employees with information about dental and vision insurance from Delta Dental. The city does not help pay for dental or vision coverage.
Employees who chose those plans would pay the full premiums, which would be deducted from their paychecks.
Risk Assessment
The insurance company that provides liability and workers’ compensation for New London has recognized the city’s efforts over the past three years to improve employment practices, safety, and loss control programs.
City and Villages Mutual Insurance Company of Wauwatosa presented a plaque and $1,000 to the city on Oct. 4.
The money is to be used for the purchase of items or services related to safety, risk management or loss control.
City finance director Radke said on Oct. 25 that the money could be spent on items such as traffic cones, digital cameras, personal protective equipment, traffic vests, an eyewash station or educational programs for employees.
New London received one of three awards given by the company, which insures 57 municipalities in the state, according to Radke.
She said the company conducts the risk management assessment every three years. New London was recognized not only for its score, but also for having the most improved score from the previous assessment.
Radke said there are hundreds of policies and procedures related to risk management.
“Keeping up to date minimizes the risk of us being sued,” she said.