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City budget workshop: Self-funded health plan renewal overall flat despite 17% rise in specific stop‑loss premium
Summary
At a City Council budget workshop, insurance consultant Cy Easterling told council members the citys self‑funded health plan for FY25–26 is expected to be essentially flat year‑over‑year overall, with a 17% increase in the specific stop‑loss premium offset by lower projected claims and 14 fewer covered lives in the snapshot used for pricing.
At a municipal budget workshop, the Biloxi City Council heard that the city—9s self‑funded health insurance plan for fiscal year 2025–26 is projected to cost about $9.96 million in combined administrative and claims expenses before employee contributions and rebates. Cy Easterling, who said he is working with the council—9s insurance committee, told council members the plan—9s specific stop‑loss premium rose 17% and represents the only significant premium increase in the renewal.
Easterling said the specific stop‑loss premium increase amounts to roughly $250,000 but was largely offset in the renewal snapshot by having 14 fewer people on the plan compared with the prior quote, which reduced projected claims by about $260,000. "We expect you to pay total about 9,960,000.00 total in admin costs and claims costs, if everything goes according to plan," Easterling said. He added that the aggregate stop‑loss premium did not change and actuaries projected no increase in overall claims because the current plan year had been favorable.
The consultant credited pharmacy changes with a substantial near‑term saving. "Through changing our pharmacy benefit manager and implementing a Canadian pharmacy program, a co pay savings program, and a what they call a, PA path where you get funding from alternative sources for high dollar medication. You have saved $530,000 documented that we have saved of moving PBM vendors in 9 months," Easterling said.
Council members questioned whether filling vacant positions would alter the calculations; Easterling confirmed claims projections would rise if enrollment increased. Council discussion noted that employee contributions were not expected to increase next year and that dental, vision and life insurance premiums will remain unchanged. Council members also discussed the city—9s four‑tier employee contribution structure, adopted two years ago, and what percentage of the premium the city covers. Easterling said the city currently pays roughly 92% of plan costs under the existing contribution methodology.
No formal action on plan design or rate changes was taken at the workshop; the presentation was informational and staff said they are available for follow‑up questions. The council did not vote on any insurance changes during the meeting.
Budget implications: the roughly $250,000 stop‑loss increase and the $9.96 million gross projection will be factors in the FY25–26 general budget discussions. Staff and the insurance committee will continue to provide details to council and remain available for one‑on‑one follow up, Easterling said.
