Council approves switch to UnitedHealthcare after Aetna decline

The city council voted to renew its employee health plan with UnitedHealthcare effective Jan. 1, 2025, after staff reported Aetna would not renew coverage for municipalities of the city’s group size.

“Our health insurance renewal is up for Jan. 1. Aetna did not offer us a renewal,” staff member (speaker 6) told the finance committee, noting UnitedHealthcare’s quote was “just over $14,000 more a month than what we are currently paying.” Insurance consultant Bill Schmaltz of Einstein Consulting Group explained why the quote rose and how the city’s HRA (health reimbursement arrangement) works. “What the HRA does, it's a health reimbursement arrangement … we buy insurance at a higher level,” Schmaltz said, and the city reimburses employees for costs under the HRA until the plan’s stop‑loss threshold is met.

Schmaltz told the committee the group’s small size and higher medical claims drove the premium increase and described options for longer‑term cost control, including custom plans and pharmacy‑cost management. “We can get Humira … at a lower price,” he said as an example of targeted pharmacy savings.

Chair (speaker 3) moved to accept UnitedHealthcare at the proposed monthly premium (approximately $42,415.68 under the current census); the motion passed in committee and was placed on the special council agenda. At the special meeting the council approved the renewal by roll call.

The council and consultant emphasized that the HRA design will remain in place and that employees’ deductible levels would not change under the proposed plan; staff noted that the monthly cost could vary with census changes. The council directed staff to place the item on the upcoming city council agenda and to provide final documentation to employees and council members.

The renewal completes the city’s immediate procurement need for employee coverage; the council was told staff and the insurance committee will pursue cost‑management strategies for future years.