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City staff propose switching short‑term disability and replacing long‑term disability with group accident plan to lower costs, increase early benefits
Summary
Hiram City human resources staff proposed replacing the city’s supplemental benefit arrangements to reduce costs and change the mix of employee protections, saying the city could lower short‑term disability premiums, increase weekly short‑term payouts and replace the city‑paid long‑term disability with a group accident plan.
Hiram City human resources staff proposed replacing the city’s supplemental benefit arrangements to reduce costs and change the mix of employee protections, saying the city could lower short‑term disability premiums, increase weekly short‑term payouts and replace the city‑paid long‑term disability with a group accident plan.
Kathy presented quotes comparing the city’s current carrier relationships with proposed Colonial Life products. She told the council the city’s current short‑term disability (STD) cost — based on the submitted census — was about $1,119.19 per month; Colonial’s quote for the same census would be $815.14 per month, which Kathy said represents an annual savings of $3,648.60 if the city switched carriers. Kathy also said the Colonial short‑term disability plan would increase the maximum weekly benefit from $750 to $1,000 and shorten the elimination period for sickness or accident from 14 days to 7 days; both plans would provide a 26‑week maximum benefit duration.
On long‑term disability (LTD), Kathy said the city currently pays about $706.30 per employee for LTD coverage that very few employees have historically accessed. She proposed replacing LTD with a group accident plan that would cost approximately $513.24 (the packet described a yearly savings of $2,316.72) and which would provide on‑ and off‑job accident coverage, recovery‑style benefits and specialized provisions (for example, an included gunshot wound benefit and escalating benefits based on tenure).
Life insurance: Kathy explained the proposed Colonial life product would raise city‑paid life insurance costs (from $384.04 on the current census to $490.25) because Colonial’s underwriting would provide a $50,000 guaranteed issue amount for all eligible employees rather than lower amounts for non‑management staff. Kathy said the Colonial product offers portability, a two‑year rate guarantee, conversion options without proof of good health and an accelerated death benefit for terminal illnesses.
Other offerings: Kathy described an optional program (referred to in the packet as a new “20/25 tuned offer”) that would provide hearing tests, custom hearing protection and hearing aid coverage for employees at no initial cost in year one, plus Norton LifeLock identity protection benefits for employees.
Procedural items and next steps: staff said any change would be planned for an effective date of Jan. 1 and that open enrollment would occur in October; staff requested time to prepare census updates and enrollment materials. Council asked staff to coordinate the supplemental insurance discussion with the employee handbook work session and to place the item on the next work session agenda.
No final procurement or contract award occurred at the meeting.
