Township authorizes HRA services as council moves employees to high-deductible health plan
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Summary
Washington Township voted to continue the municipality's Difference Card HRA program and to move employee coverage to a high-deductible health plan after officials said the change will reduce projected municipal costs even as claims rise.
The Township Council on Oct. 20 approved a resolution keeping the Difference Card HRA administrator and moving employee coverage to a high-deductible health plan (HDHP) effective Jan. 1, 2026, after a lengthy presentation on costs and projected claims.
Council members approved Resolution 25-336, authorizing ED Employment Solutions LLC (doing business as Difference Card) to provide HRA services to township employees, following presentations from township staff and benefits providers about premium changes, projected claims and budgetary impacts.
Administration officials said the state health plan’s proposed increases for 2026 made the HDHP plus the Difference Card the more affordable option for the township. Township administrator Mark DeCarlo said the state’s standard plan renewals were rising sharply and that switching to the HDHP would reduce the township’s projected premium expense even though expected claims paid through the Difference Card would rise.
"The proposed increase for 2026 for Direct 10/15 is 36.9 percent," DeCarlo told the council. "The increase for the 2035 plan is 55 percent. Even with those increases, the HDHP plus the Difference Card is projected to lower overall township costs."
DeCarlo and benefits staff walked the council through three cost scenarios presented in the packet: (1) staying on the township’s current reference plan, (2) continuing on the state 2035 plan, and (3) adopting the HDHP with the Difference Card. Officials said the HDHP option would lower the township’s net cost by roughly $322,000 on the figures shown to the council, but that claims paid from the Difference Card could be volatile.
Chief Financial Officer John Corcoran explained how the Difference Card claims account is budgeted and accounted for in municipal finance. He said a separate bank account must be maintained for claims. At year end the account balance is transferred back to the township’s current fund; the year-to-year budgetary treatment of any unused balance is separate from the cash accounting.
Several council members and staff stressed that employee coverage and benefits would not be lost. DeCarlo and benefits consultants said the Difference Card would continue to reimburse employees for eligible out-of-pocket costs and that union representatives had given preliminary buy-in to begin memoranda of agreement negotiations.
Angela Macri and other employees attended informational sessions the township held for staff; DeCarlo said presentations had been given by Trinity Brokerage and Difference Card representatives. DeCarlo said employee questions about uploads, EOBs and out-of-pocket timing had been addressed in multiple sessions.
Finance staff cautioned the council that projected savings depend heavily on claims experience. Corcoran said the township must budget for the projected cost in the annual budget cycle; any unused balance at year’s end becomes part of fund balance and is available in subsequent years under normal fund-balance rules.
The council voted to adopt the resolution authorizing the Difference Card HRA services and to proceed with plan changes and follow-up steps for union memoranda of agreement and open-enrollment timing.
The council directed administration and the benefits team to prepare the MOAs for union review and to work with staff on enrollment timelines so coverage can begin Jan. 1, 2026.
