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Midlothian council approves Cigna renewal after staff warns of $904,308 premium increase
Summary
City staff recommended renewing medical and dental plans with Cigna for fiscal year 2026–27 after broker negotiations; projected total premium increase $904,308 (city $748,892; employees $155,416) driven by a 125.9% loss ratio; council approved 5–0.
City staff recommended entering an agreement with Cigna to renew the city's medical and dental insurance for fiscal year 2026–27, reporting an estimated total cost increase of $904,308: $748,892 is estimated to fall to the city and $155,416 to employees.
"The proposed medical and dental insurance plan would result in an estimated total cost increase of $904,308 with $748,892 increase to the city and a $155,416 increase to employees," the presenter said, noting Cigna revised an initial 36.8% proposal down to a negotiated 17% increase for the city's current plans. Staff explained the city's loss ratio had been unusually high — 125.9% — and that a small number of large claimants accounted for a large share of claims. Council members pressed staff on wellness and long-term strategies; the presenter said a more robust, data-driven wellness program is planned for FY 2027–28 to address preventable claims. The council approved the renewal 5–0.
The presenter also reported the total medical cost for FY 2026–27 is estimated at $5,218,464 and said dental premiums would decrease slightly under Cigna's bundled proposal. Council discussion included historical loss-ratio figures for recent years and an explanation that market trends were contributing an underlying 10%–11% pressure on premiums separate from local claim experience.
