Salisbury approves higher health-plan contributions; city pays larger share to limit employee increase

Salisbury City Council voted April 15 to raise the city’s contribution to the municipal health and dental insurance plan by 10% and to increase employee contributions by 5%, both effective July 1, 2025.

City finance and human-resources staff told the council a combination of unusually large medical claims in the current plan year and general cost trends left the employee health fund drawing down reserves. Finance Director Wade D'Furchas and HR Director Ruth Kennerly said the recommended funding change would stabilize the plan without requiring a single, larger jump for workers.

Consultant Mark Browder of Mark 3, the city’s benefits adviser, told the council the city’s self-funded plan had been well-managed and benefited from favorable regional contract terms negotiated with Blue Cross Blue Shield, but high-cost claimants (notably cancer and musculoskeletal treatment costs) pushed expenses up this year. Browder said the stop-loss protections and negotiated rebates had limited volatility but that fund cash balances had declined and projected expenses were up for FY2026.

Staff presented two options. The consultant’s minimum recommendation was a 9% across-the-board increase; instead, staff proposed the city increase its share by 10% and employees increase by 5%. Kennerly explained that spreading the increase would lower the direct payroll effect for employees while contributing roughly $320,000 to the general fund’s cost for FY2026. The staff packet showed the 10% city increase would translate to an approximate $320,000 increase in city costs and that $1.01 on the property tax rate equals about $429,000.

City staff and the consultant also described wellness, mental-health and preventive programs the city runs, including an on-site wellness clinic, expanded employee-assistance benefits, and public-safety screening programs. Those programs were cited as part of the reason the plan could be managed with a moderate funding change rather than a larger one.

After public and council questions about dollars-and-cents impacts and employee input, a council member moved to adopt the recommendation. No roll-call vote was taken in the meeting record; the mayor called the question and the motion passed.

The change will be included in employee open-enrollment materials and requires staff to finalize payroll adjustments before the July 1 plan year start.

Votes at a glance: The council approved a 10% increase to the city's contribution and a 5% increase to employees' contribution to health and dental insurance, effective July 1, 2025.