Llano City Council on Tuesday reviewed proposals for the city’s employee benefits package for fiscal 2025–26, but did not adopt a plan after a presentation by independent brokers and a failed motion to accept one of the proposed options.

The discussion mattered because the council must set budget assumptions for health, dental, vision, life and long-term disability coverage and because insurers and the Texas Health Benefits Pool impose renewal deadlines. Javier Reyes, identified in the meeting as “president of Insurance Brokers,” told the council he had solicited competitive quotes and described differences among the offers on price, networks and benefit design.

Reyes said carriers generally could not match the city’s current “inclusive” office-visit copay — a plan feature that covers many in-office procedures under a copay rather than applying the deductible — and that was a key reason renewals were limited. He told the council the carrier that most closely matched the city’s current design would produce a roughly 4% increase on the existing plan, an increase the brokers and council analyzed alongside two alternative plan designs labeled “Option 3” and “Option 4.”

Under the figures presented, a straight renewal of the current plan (a 4% increase) would raise the city’s total cost by about $23,000. Option 3 was estimated to add roughly $7,000 instead of $23,000; Option 4 was estimated to add about $2,000 versus current spending. Reyes said shifting to Option 3 would reduce the city’s premium bill by about $16,000 compared with renewing the current plan but would raise an individual’s potential out-of-pocket exposure if hospitalized (the presentation described a possible increase in the maximum out-of-pocket to $9,000 for covered employees under that option). “That is one way to drop your increase from 4% to, like, 1.3%,” Reyes said of the design that raises out-of-pocket maximums.

Council members pressed for data on how many employees actually reach deductibles or require hospitalization, and for participation figures the carriers use to price tiers. Reyes said the city’s current plan covers roughly 42 employees for dental and vision (the broker used that figure to price those lines), that the city has about 48–49 full‑time regular employees in total, and that 23 employees participate in the flexible spending account. He said the city’s HRA (health reimbursement arrangement) balance is about $10,000, with approximately six employees holding $700 or more each in the HRA. The broker also noted the city pays about $3,060 a year for a group $20,000 life policy covering employees.

On dental and vision, Reyes said the city’s dental contract includes a 90th-percentile reimbursement arrangement (a richer schedule that reduces balance billing risk when employees visit a non‑network dentist) and a dental reserve/rollover that can accumulate an extra benefit for low-use employees. For vision, the council heard that a VSP network had been chosen previously because local employees reported provider compatibility with that network; some cheaper vision quotes used other networks that might not include the city’s long‑used providers.

Reyes highlighted options beyond price: Hartford’s long‑term disability proposal included a three‑year benefit period for many conditions and looser pre‑existing and elimination‑period rules than other carriers quoted; the broker described those features as materially more generous in the Hartford offer.

Council members weighed the tradeoffs between near‑term budget savings and greater out‑of‑pocket risk for employees. One council member moved to accept Option 4; a second was heard, but the motion failed. After discussion the council directed staff to obtain additional utilization detail (how often employees reach deductibles or are hospitalized), to confirm participation counts used in the quotes, and asked the broker to request a short extension from the Texas Health Benefits Pool so the council could review any late, lower bids before committing. Reyes said he would contact the pool the following business day to request one more week, if the council wanted it.

No final insurance selection was adopted at the meeting. Staff recommended, and the council accepted, returning the benefits matter for further consideration after the budget workshop so the governing body could take action with updated utilization and enrollment data.

The council’s debate emphasized preserving the plan feature described by the broker as an “inclusive office copay” (which several council members and the broker characterized as a valued, locally unusual benefit), balanced against the city’s need to control payroll‑driven expenditures. The council also heard repeated cautions from the broker that some rates were “semi‑firm” and carriers reserve the right to reprice if enrollment changes by more than carrier‑specified thresholds.

Council members asked staff to bring back the utilization metrics and to confirm whether any lower offers arrived in the week after the meeting; the council similarly requested a clarified breakout of the cost differences among the three options for each employee tier (employee only, employee + child, employee + spouse, family) before voting.