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Council approves modest changes to retiree Medicare Advantage plan to cut city costs by about $52,000
Summary
The Eastpointe City Council approved changes to retiree Medicare Advantage plan cost‑sharing that increase a deductible and certain copays; staff said the change will save about $52,000 annually while leaving maximum out‑of‑pocket protections intact.
The Eastpointe City Council voted May 6 to modify retiree Medicare Advantage plan cost‑sharing by increasing some deductibles and copays, a move city staff said would reduce the city’s cost by roughly $52,000 annually.
Finance Director Mister Blum told council the proposed changes would raise the annual deductible from $750 to $1,000, keep the coinsurance percentage the same and increase several point‑of‑service copays: emergency room visits from $75 to $90, urgent care visits from $20 to $40, routine office visits from $20 to $30 and specialist visits from $20 to $35. Blum said the plan’s overall maximum out‑of‑pocket and other major plan features would remain the same.
Blum said the changes were proposed after the city saw a large increase in Medicare Advantage costs driven in part by the federal Inflation Reduction Act’s prescription‑drug out‑of‑pocket cap; staff sought a plan design that reduced the city’s premium exposure without significantly affecting retirees. He estimated the changes would save the city about $52,000 a year once the plan is in effect.
Council approved the change by roll call, with one no vote. Staff noted that notice to Blue Cross is required in June for a January 1 plan effective date. Council members asked about interactions with collective bargaining agreements; finance staff said retiree healthcare is no longer in active contract status and recent court rulings permit the city flexibility to amend retiree plan design.
Why it matters: The change reduces city costs for retiree healthcare while slightly increasing cost‑sharing for retirees who use services frequently. The changes will take effect January 1 if timely notice is provided to the insurer.
Discussion vs. decision: Council discussed tradeoffs between savings and retiree out‑of‑pocket exposure; the formal decision approved the plan changes for 2026 implementation.
Vote: Motion to adopt the Medicare Advantage plan changes passed on roll call with one member voting no (see action record).
