By Katie Northcott, News Director
At its meeting on Thursday, Oct. 30, the Shelbyville’s Employee Benefits Review Committee (EBRC) made a recommendation that the City Council consider a new insurance policy.
The recommendation comes after about a month and a series of seven meetings. The EBRC heard from three different insurance companies and received rates from all three.
After comparing prices, benefits, and employee feedback, the EBRC recommended that the City Council vote to switch to the Tennessee Municipal League’s (TML) Gap Coverage, which is provided through Zurich Insurance Group’s Supplemental Gap Medical Insurance.
“I asked them for the downside, and I don’t see one,” said Buck Vallad, Shelbyville Director of Public Works. “A quarter-of-a-million-dollar savings and all you have to do is hold an extra card in your wallet. What’s the downside?”
Blue Cross Blue Shield (BCBS) would continue as the city’s primary insurance provider. Zurich would supplement that insurance so that the city can pay lower premiums without actually assuming more financial risk because the risk would be distributed between three entities instead of two. City employees would need to carry an insurance card for each insurance provider.
TML raised the deductible on the city’s current plan–the amount employees will have to pay before the insurance company starts to pay–from $2,000 to $6,350. They also raised the out-of-pocket maximum employees could pay from $4,000 to $10,600. These increases mean that some risk is taken off of BCBS which causes the insurance premiums to decrease.
Zurich’s supplemental insurance would then take on some of the risk and drop the deductible and out-of-pocket maximum both to $1,000. A notable increase on the plan is an $80 increase in urgent care co-pays.
Below is a table showing the cost breakdown and benefits offered through the program. The purple column indicates the city’s current medical insurance rates and benefits. The blue column indicates the rates and benefits under the Gap program.
The EBRC is hopeful that the switch will save the city over $250,000 on medical insurance costs and recommends the city use the savings to give employees dental and vision benefits.
“The only downside I see is that it is a new program. It’s in its infancy,” City Council member Henry Feldhaus said. “In a year or two or three from now, I’m going to bet my lunch money there’s going to be cost increases.”
Feldhaus later noted that BCBS’s premiums would go up during the next few years if the city stayed with its current plan.
The program launched in July with the city of Monterey and has added six to eight cities to its clientele since its launch. The program, which is a partnership between TML and FMIG Health, aims to help small municipalities in Tennessee that are being inordinately affected by rising insurance premiums.
During the past month, the EBRC also heard pitches from representatives of BCBS and Partners for Health (the state plan).
BCBS pitched two alternatives to the current plan. However, the alternatives would either offer less benefits for a lower cost to the city or more benefits for a higher cost to the city. Those options are compared to the city’s current plan in the chart below:
The city could choose to make Alternative 1 its base plan and then help employees who want to buy up to a plan with more benefits by covering part of the buy up.
Similarly, the city would either compromise on employee benefits or increase insurance premiums by joining Partners for Health’s insurance program. Notably, the city would increase the employee’s out-of-pocket maximum if it chose to save money under the Partners for Health program as indicated by the chart below.
The Shelbyville City Council will consider the EBRC’s recommendation at its study session at 6 p.m. on Thursday, Nov. 6.
The post Shelbyville Employee Benefits Review Committee to Recommend Change in City Employee Insurance Benefits appeared first on Thunder Radio.
