Budget and Finance Committee backs employee health plan renewal; Aetna renewal nets 5.81% increase

The Recreation Centers of Sun City West Budget and Finance Committee on Jan. 21 reviewed an employee health-and-benefits renewal and agreed by consensus to move forward with the recommended package, which reflects a 5.81% aggregate premium increase negotiated with Aetna and broker Lehi & Touche (Marsh McLennan Agency).

Committee Chair Christine Novello opened the discussion and turned the presentation over to Kirsten Pearson Peterson, head of human resources, and to Scott Ragland, principal and executive vice president with Lehi & Touche, who walked committee members through the vendor selection, underwriting, and renewal negotiations.

Why it matters: employee benefits are the largest recurring personnel expense outside wages and a key retention tool for the association. The committee’s acceptance of the renewal sets the employer cost baseline that will be built into the 2025 budget and payroll forecasts.

Key details from the presentation

- Renewal outcome and carrier: Scott Ragland said Aetna’s negotiated renewal produced a revised increase of 5.81% after initial pricing that approached double digits; the broker’s conservative internal projection had been substantially higher. Ragland described the path to that number as the result of negotiation and a no-bid offer from Aetna.

- Plan design changes: the high-deductible HSA-qualified plan’s IRS-compliant deductible level increased to $3,300 for employee-only coverage and $6,600 for family coverage; Ragland noted those HSA minimums are required by federal rules and typically tick up year to year.

- Enrollment and funding mechanics: Ragland reported 138 employee subscribers at the time of renewal and 235 total members including dependents; later accounting notes indicated 131 employees on the plan at year-end. The broker explained the plan is effectively fully insured with an individual pooling (stop-loss) point set at $125,000.

- Employer share and employee costs: the association’s contribution rate was presented as about 84% of premium (employer share), which the broker described as “on the higher side” compared with many employers but favorable for recruiting and dependent coverage. Example employee rates presented included an employee monthly contribution of $142 for the HDHP option (about $71 per pay period). The aggregate employer cost rise from 2024 to 2025 was shown at roughly 5.32% ($118,000).

- Marketplace context and bargaining: Ragland summarized market pressures—pharmacy benefit manager contracting, medical inflation and generational differences in benefit needs—and said the broker models both conservative (worst‑case) and aggressive (negotiating) renewal scenarios before bargaining with carriers. “My goal is to get every single client at 0 or even less than 0, a reduction,” Ragland said of his negotiating objectives.

Committee discussion and next steps

Committee members asked about loss-ratio weighting, carriers’ profitability targets, use of the individual market or HRAs as alternatives, and the degree of employee satisfaction with current benefits. Kirsten Pearson Peterson described the annual renewal and open-enrollment timeline and said HR had direct contact with hundreds of employees during enrollment. Novello noted the committee reached consensus to proceed with the renewal as presented and that workers’ compensation and other insurance components will be presented separately (expected in February).

The committee did not record a roll-call vote; staff noted the committee reached consensus and will reflect the renewal in the association’s budget and payroll planning.