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City staff present 15.7% health insurance renewal increase and proposed plan design changes
Summary
Human resources recommended removing the $250 plan and offering three alternative plan designs after a 15.7% renewal increase that would raise total premiums by nearly $1 million (city share ~ $800,000; employees ~ $180,000), while adding deductibles for non‑generic prescription tiers and tightening GLP‑1 drug coverage to diagnosis‑based eligibility.
City human resources staff presented the city’s health insurance renewal and proposed plan adjustments that respond to a 15.7% premium increase for the coming plan year.
HR staff said the renewal would increase overall premiums by just under $1 million; their analysis showed the city’s share would rise by about $800,000 and employee costs by roughly $180,000. To limit cost growth, staff recommended moving from the current set of plans to three options (Key Advantage 500, Key Advantage 1000 and a high‑deductible health plan) and eliminating the $250 plan from the lineup.
Mary Jones, who reviewed plan‑design changes, said the recommendation would introduce a $150 deductible for certain prescription tiers, a 20% co‑insurance up to a script maximum for tier‑four medications, and an IRS‑driven increase to high‑deductible plan maximums (necessary to maintain HSA eligibility). She also described a change narrowing GLP‑1 drug coverage: beginning July 1, coverage for those drugs would require a diagnosis relevant to the drug’s intended use rather than being available for weight loss alone.
Jones said the employee assistance program will be expanded to all city employees regardless of plan enrollment, and reminded council that renewals are due to the Local Choice program by April 1.
What happens next: staff will return with final plan selections and contribution recommendations for council vote at the next meeting.
