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Broker tells Sedalia council medical renewal could require double-digit rate increases and plan changes
Summary
IMA told the council its analysis found a 27.7% needed increase to 2026 funding rates driven by a large stop‑loss premium spike tied to $1.6M in claims over the plan’s $100,000 specific deductible; consultants recommended contribution and plan-design options.
City-contracted broker IMA presented its review of the city’s employee benefits renewal and told the Sedalia City Council that unusually large claims are driving a steep stop‑loss premium increase for the plan’s 2026 renewal.
Anna Konopasek of IMA said claims above the plan’s $100,000 specific deductible totaled about $1,600,000 in the most recent review period and that insurers raised the stop‑loss premium on those large claims by roughly 75 percent. Based on market solicitations and internal modeling, IMA said a 27.7 percent increase to funding rates would be needed for 2026 (that figure includes a recommended 10 percent margin).
IMA described several cost-sharing options: increasing employee contributions by 12 percent while the city absorbs 30 percent of that increase, and remaining in the bundled partially self-funded arrangement with the existing $100,000 specific deductible. The presenter also stated the city would absorb a large share of the overall increase under the recommended approach and noted that alternative stop‑loss options were either noncompetitive or declined by carriers.
On ancillary benefits, IMA recommended moving the dental plan to Blue Cross Blue Shield of Kansas City to secure a two‑year rate guarantee and a third-year rate cap; it recommended grossing up employer-paid long‑term disability premiums (the presenter cited the gross‑up cost around $9,000) so benefits are taxed differently for employees. No council vote was recorded on these recommendations during the meeting; the presentation was informational and intended to inform FY2026 budget discussions.
What happens next: Staff will use IMA’s recommendations to develop budget options for council consideration, including proposed employer/employee cost-sharing and any plan-design changes.
