Woodland Hills City considers new healthcare options with PEHP to save costs

The Woodland Hills City Council convened on March 11, 2025, to discuss employee health insurance options, focusing on potential changes to the current plan provided by SelectHealth. The meeting highlighted the financial implications of proposed rate increases and alternative plans aimed at improving employee benefits while managing costs for the city.

The current SelectHealth plan costs approximately $6,600 monthly for three employees, with a proposed rate increase of 12.7%. This increase was deemed reasonable compared to market trends, but the council explored other options to mitigate costs. Various proposals were reviewed, including a health share product that was ultimately dismissed due to its inadequacies.

Aetna presented a plan with a potential 17% decrease in premiums, contingent on employees completing health questionnaires. However, concerns about potential rate increases based on health disclosures led the council to disregard this option. Other proposals indicated steep increases of 40% or more, prompting further investigation into alternatives.

The council reached out to PEHP, which provided several proposals, including traditional plans and high deductible health plans (HDHPs) paired with health savings accounts (HSAs). The HDHP option was highlighted for its potential to save the city approximately $4,200 annually while offering employees a valuable investment tool through HSAs. The council discussed the benefits of lower out-of-pocket maximums for catastrophic events under the HDHP, which could significantly reduce financial exposure for employees.

Two main options were presented for consideration: one with a $3,300 family deductible and another with a higher deductible but increased HSA contributions. The latter option was favored for its potential to save the city 15% compared to the renewal rate while providing employees with more control over their healthcare spending.

The council also considered adding dental coverage to the benefits package, which would require amending the employee handbook. The cost of dental coverage was noted to be significantly lower than medical premiums, and discussions included the feasibility of offering this benefit without imposing additional financial burdens on the city.

In conclusion, the council's deliberations emphasized a commitment to providing competitive employee benefits while ensuring fiscal responsibility. The proposed shift to a high deductible plan with HSA contributions was seen as a strategic move to balance employee needs with the city's budgetary constraints. Further discussions will be necessary to finalize decisions on the health insurance options and potential inclusion of dental coverage.