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City plans to stay with Blue Cross Blue Shield for FY26 while considering long-term options
Summary
City officials told the finance committee the health-insurance trust fund balance is about $1.4 million and that, after reviewing options, the city plans to keep Blue Cross Blue Shield for fiscal year 2026 while continuing longer-term analysis including possible Group Insurance Commission membership.
The city auditor reported to the finance committee that the municipal health-insurance trust fund balance is approximately $1,400,000. City officials said a healthy target range is between $1 million and $2 million, with $2 million identified as an ideal balance.
Administration staff and the auditor reviewed multiple options for health insurance, including remaining with Blue Cross Blue Shield, joining the Group Insurance Commission (GIC), the Massachusetts Interlocal Insurance Agency, or working with different brokers. For the near term the administration concluded the lowest proposed increase for the coming fiscal year would come from remaining with Blue Cross Blue Shield; therefore the city intends to keep that carrier for FY26.
Officials also outlined timeline constraints for switching to the GIC: applications require six-month notice and the GIC timeline effectively means the earliest practical entry date would be Jan. 1 of the next calendar year if a change were approved now. City open enrollment for employees will run May 1 through May 31 to allow rates and elections to be in place before the June 1 payroll period and the new fiscal year start on July 1. The administration said it will continue a multi-year review of options beyond a year-by-year approach.
