11/24/2012 7:30:00 AM City negotiates 10 percent decrease
in health insurance rates
In a world where ever-increasing health insurance costs are typically the trend, the city of Rhinelander will be keeping that expense in check over the next two years.
The city recently negotiated a 10 percent decrease with Security Health Plan in its insurance rates for 2013 and have been promised an increase in 2014 no higher than 12 percent. That equates to a maximum increase of 2 percent over the next two years.
"It should help the general fund some," City Administrator Blaine Oborn said. "I haven't calculated the full amount (of savings) but we could always use more surplus in the budget. It was a tight budget overall."
The city had initially budgeted for a slight increase in insurance rates. Oborn said it's difficult to put an exact numerical value to the financial impact of the rate decrease. Some of the savings will occur with the tax dollars in the city's general fund. But the utility funds are used to pay wages and benefits for some city employees. Employees of the Rhinelander District Library and the Rhinelander-Oneida County Airport also use the city's health insurance but are only partially financed by the city's tax roll. For 2013, all of those entities will benefit in some way from a 10 percent rate decrease.
Oborn commended the efforts of city staff and Jennifer Cordy, a health insurance specialist with Boyd Financial Services, for negotiating a rate decrease.
"A 2 percent (maximum) increase in a two-year period is very good," Oborn said.
Cordy assisted the city in shopping its insurance and potentially looking for a new provider. The goal was to maintain the current benefits at the best possible value, Oborn said.
In the end, the city received a good offer from its current provider, Security Health Plan, and didn't need to make a change. Cordy said simply shopping the insurance and adding some competition to the process helped in the negotiations with Security. It also helped that users of the city's insurance haven't had a lot of major claims in recent years, she said.
"We chose to do the bigger discount upfront and hopefully (users of the insurance) will continue on a healthy trend," Cordy said.
City officials want to keep it that way. They're looking at possibly adding some wellness incentives for members of the city's insurance.
"The idea is that if people are healthier, there's less usage (of the insurance) and the rate goes down," Oborn said.
But the city health plan already includes some preventive measures that are fully covered. Cordy said the city's effort to make people aware of all those benefits has been lacking in recent years.
"The goal is to re-educate people on what the benefits are," Cordy said. "We want to make sure current members are taking advantage (of the preventive care benefits) if they so desire."
Cordy said informational meetings have already occurred for retirees using the insurance. Several sessions are also being set up next month for current employees and their families.
Kyle Rogers may be reached at email@example.com.
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