Village staff and representatives from the Intergovernmental Personnel Benefit Cooperative (IPBC) presented a proposal on Aug. 4 for the Village of East Dundee to move employee medical, prescription and life insurance from a private broker to IPBC, a membership-based self-insurance cooperative for local governments.
"We are another unit of local government," IPBC Executive Director Dave Cook said, describing the cooperative’s structure and governance and emphasizing pooled buying power and transparency. "We are here to provide our members with the most cost effective means of procuring your medical benefits," Cook said, adding that IPBC covers more than 23,000 employees and that its purchasing scale has produced substantial drug and administrative savings in recent procurements.
Staff said the village's five-year trend on insurance costs averaged about 7.6% and that IPBC's five-year average increases have been lower in the cooperative's pools. Karen Williams, a senior benefits consultant with IPBC, described the cooperative's client-service model and said IPBC provides open data, wellness incentives, an EAP and benchmarking reports for members. Cook and Williams said IPBC typically groups members into pooled stop-loss structures and that dividends or lower long-term trend can result from the pooled model.
Trustees asked about provider networks, the ability of employees and retirees to continue coverage, and whether certain insurers such as Blue Cross would be available immediately. IPBC staff said members effectively "rent" provider networks (Blue Cross and UnitedHealthcare are network partners in bids) and that Blue Cross cooperative rules can limit a switch-back for very small groups for up to two years. Staff also said they would meet individually with unions before any formal transition because collective-bargaining contracts may contain language about plan changes.
What the board decided: Trustees directed staff to pursue further steps, including union consultations and more detailed analysis; President Pearson signaled approval to move forward with the evaluation toward a potential Jan. 1 plan-year change if the village and unions agree. There was no final contractual approval at the Aug. 4 meeting.
Why it matters: Switching to IPBC could lower long-run benefit trend and administrative costs for the village and change how benefits and retiree continuation are administered; the change would also require union consultation and a short transition process.
Ending: Staff will continue to meet with unions, refine cost comparisons and, if unions and staff agree, prepare a resolution and implementation plan for the board to consider before a Jan. 1 effective date.