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Dumont council approves health-reimbursement plan for borough employees, contingent on union and state sign-off
Summary
The Dumont Borough Council voted to create a health reimbursement account to pair with a new NJ Direct medical plan; the program funds $7,360 per individual (and $14,720 for other tiers) in 2025 and is contingent on memoranda of understanding with the PBA and DPW unions and state approval.
The Dumont Borough Council on the night it adopted its capital bond also approved Resolution 150 to fund a borough-managed health reimbursement arrangement (HRA) for employees who enroll in the NJ Direct 2035 medical plan.
The measure, adopted after public comment, authorizes the borough to fund an HRA intended to offset the difference in out-of-pocket costs between the new NJ Direct 2035 plan and the prior NJ Direct 10 plan. The resolution specifies $7,360 for employees on an individual plan and $14,720 for other tiers for the 2025 benefit year; the HRA would be administered through a debit-style vendor (the “difference card”).
Council and staff emphasized the resolution is conditional. The HRA and plan change will only take effect if the borough secures memoranda of understanding with both the PBA and DPW unions and receives required approvals from the New Jersey State Health Benefits Plan. “This resolution is contingent upon receiving the memorandum of understanding agreements between the borough’s unions,” a presenter said during the discussion.
Administrators and the borough’s benefits consultant told the council the change could lower the borough’s premium costs while preserving employee out-of-pocket parity via the HRA. Officials said the borough could realize roughly $300,000 in annual savings if all employees transitioned and enrollments proceeded as projected. “There was a significant cost saving to the borough without any impact on the coverage to the employees,” a staff presenter said.
A resident asked whether dental and vision are included; staff answered that Delta Dental remains separate and the resolution covers medical and prescription benefits only. Public commenters also sought clarification on how the HRA amounts would be pooled when employees elect family coverage versus individual coverage; staff explained the funds are held in a single HRA pool and the state-prescribed allocation amounts apply per plan tier.
Vote: The council adopted Resolution 150 (Ponti: yes; Kelly: abstain; Coralis: yes; Morell: yes). Next steps listed by staff include finalizing memoranda with unions and seeking state approval during the required 60-day review period so changes could take effect before the next enrollment window.
