Coventry council selects Cigna Direct plan for FY27 amid reserve and cost questions

The Coventry Town Council on Feb. 17 adopted a motion to select Cigna Direct as the town’s health insurance option for fiscal year 2027.

Councilor Robyn Gallagher moved that the council pick the Cigna Direct option; Councilor Matthew Kyer seconded. In discussion, Town Manager James Drumm said the town’s reserves are "estimated to be about $2.8 million," though he cautioned that the final usable amount will depend on claims submissions. A participant identified as Trahan said she believed the net amount available could be about $1 million after claims are settled. Councilor Mark Wheaton recapped figures from the joint Finance meeting that placed typical self-funded plan costs near $8.5 million and the state plan near $10.2 million; that comparison factored in HSA contributions and state runoff but left open concerns about future premium increases under a state plan.

Wheaton also asked about penalties for leaving the state program; Drumm said the penalty discussed was about 5 percent. Gallagher and other councilors discussed the trade-offs between self-funded plans and the state plan, including loss of reserve buildup if the town later exits a state plan. Gallagher noted the Board of Education had already voted to go with Cigna Direct, which influenced the council’s recommendation to align plans for now.

Councilors expressed a desire to further examine insurance options and suggested the Finance Committee make insurance review a standing agenda item next year. With those qualifications, the council voted unanimously to select the Cigna Direct option for FY27.