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Kearney to switch employee health carrier; Aetna proposal yields small net premium savings
Summary
City staff recommended switching employee health plans after a RFP; Aetna's proposal showed an overall premium decrease of about 1.33% (roughly $7,600) versus a 13% increase proposed by the incumbent, and the board approved staff’s recommendations including a $300/month HSA contribution and adding an FSA.
City administrator Sheila presented results of an RFP for employee health and benefits and recommended multiple plan changes that staff said would modestly lower costs for employees and the city.
Scott Heffner of consultant Bukati told the board that Aetna’s proposal would produce an overall decrease of about 1.33% in premiums, an estimated savings of roughly $7,600 annually compared with the current carrier’s proposed 13% increase. Heffner said networks for the large carriers substantially overlap — "about 97% overlap" — and that staff worked to match deductibles and out‑of‑pocket levels to limit disruption to employees.
Staff recommended continuing the $300 monthly HSA contribution for employees enrolled in the high‑deductible health plan, switching dental and vision carriers (Delta Dental/Delta Vision), and increasing basic life insurance from $25,000 to $50,000. The board discussed whether shifting carriers frequently could deter vendors and examined potential changes in deductibles and out‑of‑pocket maximums; Heffner advised that, in small‑group markets, annual shopping is common and network changes are usually limited.
After discussion the board moved to approve the employee benefits recommendation, including the 12‑month premium allocation beginning 12/01/2024 and authorizing the city administrator to execute required documents.
