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Brookhaven staff say health‑plan renewal negotiated down to 4.5% after Cigna sought 19% hike
Summary
Benefits broker Jim Stewart told the council Cigna initially proposed about a 19% premium increase (roughly $645,000) but negotiations reduced the renewal to 4.5%; the HSA deductible would rise to $3,400 and the city is proposing modest employee contribution increases by tier.
Jim Stewart, vice president of relations for the city’s benefits broker, presented the proposed 2026 employee health‑plan renewal at the Brookhaven work session and described a negotiation that reduced what he said was an initial 19% renewal request to a 4.5% increase.
“We were able to negotiate that down to 4.5,” Stewart said, describing an initial Cigna proposal that he said would have represented about a $645,000 premium increase. He attributed the original request in part to the city’s recent loss ratio: “your loss ratio ran at 111.5%. The target is 85%,” Stewart said when council members asked about drivers of the requested increase.
Key elements Stewart outlined: the city is proposing to stay with Cigna; the HSA deductible will rise to $3,400 (an IRS adjustment); the city will continue seeding HSA accounts (Stewart cited roughly $6,800 per year in employer contributions for employees and families); dental and vision carriers show no proposed rate increases; and the benefits package will continue to include life and disability coverage. He also described a contribution strategy that would pass part of the modest increase to employees: a 3% increase for employees meeting preferred‑wellness criteria, 4.5% for standard non‑tobacco users and 6% for tobacco users.
Human Resources staff explained available wellness and lifestyle programs that allow employees to access discounted gym memberships and other wellness incentives. Stewart also noted an opt‑out incentive of $400 per month for employees who waive medical coverage; the presentation said 24 employees currently opt out and that the program costs roughly $115,000 annually.
Council members asked for detail on the drivers of the initial 19% request. Stewart said auditors and actuaries identified that some large claimants had ended, which helped negotiations lower the renewal; he said the city’s rolling 12‑month medical loss ratio was the major factor. City staff also cautioned that the budgetary impact could exceed the 4.5% base increase depending on employees’ plan choices; a council speaker noted a trend of employees moving from single to family coverage could raise actual costs beyond the negotiated rate.
The presentation was informational; no vote was taken at the work session. Councilors thanked the HR and finance teams for negotiation work and asked staff to reflect the negotiated rates and updated plan mix in the upcoming 2026 budget documents.
