Hannibal’s employee benefit board moves city coverage to state program; city and retirees face transition costs

The Employee Benefit Trust Board has elected to enroll the City of Hannibal and the Board of Public Works in the Missouri Consolidated Health Care Program (MCHCP), moving the city from a self-funded insurance model to a fully funded plan that the board estimates could save the city more than $1,000,000 per year.

City Clerk Melissa Cogdell, who presented the update to the City Council, said the change will shift claims liability from the city to the carrier and set fixed annual premiums. Cogdell told the council the city has been self-funded for more than 30 years and that reserves were depleted by large claimant costs and rising local and prescription expenses.

The change matters to city finances and employees. Under the plan the board selected, runout claims, third-party administrator fees and stop-loss premiums for prior liabilities are estimated between $600,000 and $800,000. The board and staff said those runout costs will be paid before the city’s coverage converts to the fixed-cost contract.

Details the board recorded include lower employee cost-sharing and plan design changes: individual deductibles fall from $2,000 to $1,250 and family deductibles from $4,000 to $2,500; the plan will offer four premium tiers (replacing a previous two-tier structure); primary care, mental-health and chiropractic copays remain; virtual visits through the MCHCP app are free. Cogdell provided several sample premium figures: an individual premium would decrease from $769.79 to $759.82 (city pays 100% of the employee share); a family tier for two adults showed large decreases for some tiers and a modest increase for full-family coverage (full-family premium shown increasing to $813.01 in one example). The city will continue to pay 50% of family premiums (65% for certain fire employees hired before July 1, 2011) and Board of Public Works contribution levels were also described.

Council members and the interim city manager described the decision as the product of multiple quotes and board deliberations. Interim City Manager Andy Dorian and Mayor Darryl McCoy both thanked staff and trustees; Councilman Cohen and others said employees had been receptive though retirees raised the most concern. Cogdell said retirees were removed from the city’s previous plan under prior steps and that MCHCP contractual rules require retirees to be managed differently; staff said they are working to address retiree impacts.

No formal city council vote was required or taken at the meeting; the Employee Benefit Trust Board had already made the enrollment decision. Cogdell said the new coverage is scheduled to take effect July 1, 2025, and that open‑enrollment meetings are planned ‘‘on the 14th, 15th, and 16th’’ (dates given in the meeting but the month was not specified during the presentation). She also said the self‑insurance preliminary revenue budget for FY 2025–26 is $3.2 million and expenditures $3.1 million.

The update included several implementation items for staff: publish employee materials and hold the announced enrollment meetings, finalize runout-cost accounting and payments before July 1, and incorporate the fixed costs into the FY2025–26 budget so the change appears in the city’s adopted revenue and expenditure lines.

Council members encouraged employees and residents to attend the Employee Benefit Trust Board meetings (held monthly) if they want more detail.

Ending: Staff said more detailed plan documents are available on request; the city clerk and benefits staff will distribute enrollment materials and answer employee questions before the July 1 transition.