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Health-insurance fund faces higher claims; retirees on plan drop after benefits change, wellness clinic expands services
Summary
Staff reported health-insurance claims spiked in June (about $929,000), the retiree count on the plan fell from about 80 to 33 after a February change, the fund reserve is about $1.6 million and staff are not proposing premium changes for employees for FY26; the wellness clinic will add physical therapy and expanded services.
Brandy (staff member and budget presenter) told the commission the city's internal health-insurance fund faces rising claims and currently sits below its target reserve of about $1.6 million. She said the June claims run spiked to approximately $929,000 for the month and that staff is monitoring stop-loss thresholds and other claim-management tools.
Brandy said a policy change in February reduced the number of retirees on the city plan from about 80 to 33, which lowered expected retiree contribution revenue. She said the city budgets an employer contribution (stated in the workshop as roughly $2.2 million) and will "true up" the fund at year-end as needed; staff previously used general-fund transfers when claims exceeded budgeted levels.
Staff is not proposing premium increases for employees for FY26. The wellness clinic will expand services to include physical therapy and will provide annual physicals for police and fire; Brandy said the physical-therapy service starts this week. Staff noted June's high claims are driven by several high-dollar, non-COVID catastrophic claims but did not provide HIPAA-protected claim detail in the workshop.
Brandy said staff may reallocate costs across funds or use multiple funds to make any needed year-end true-up if claims require additional funding.
