Northfield council accepts Medical Mutual renewal with 8% increase; budget impact estimated at $51,700

On Sept. 9 the Village of Northfield Council voted to accept an 8% renewal offer from Medical Mutual for the village’s employee medical insurance, a decision the village’s insurance agent said will increase costs by about $51,700 for the next coverage year.

Finance Director and Clerk of Council Jennifer Potvin introduced the item and agent Mike Troyan told council that Medical Mutual initially proposed a 16.7% increase but negotiated that down to 8% on the condition the village accept the quote immediately and not seek competing bids. Troyan said the recommendation to accept was based on the village’s recent paid‑claim history, the village’s grandfathered Affordable Care Act plan status that would be lost if it switched insurers, and broader market increases averaging 9%–11% this year.

Law Director Brad Bryan told council that existing union contracts do not require union agreement for health insurance cost‑saving measures unless an annual increase meets or exceeds 13%, and he noted the current coverage year expires Oct. 31, 2020. Troyan told council Medical Mutual requested a response by the prior Friday; council said it needed to act at the meeting so staff could notify the carrier. Council voted to accept the 8% renewal on a motion by Councilperson Gary Vojtush, seconded by Councilperson Nick Magistrelli; roll call votes were recorded as Vojtush — yes; Magistrelli — yes; Hipps — yes; Domzalski — yes.

Next steps: staff will obtain the formal rate sheet reflecting the negotiated 8% renewal and return to council for formal authorization to execute the new coverage agreements at the next meeting. The village’s collective bargaining negotiations were not scheduled to begin until December 2020.