Health Insurance Costs Climb for Macomb
The city of Macomb and some city employees will have to pay more for health insurance this year.
City Administrator Dean Torreson said 2014 was a heavy claims year for Macomb, costing the city about $216,000 more than expected.
The city’s plan is partially self-funded. Macomb pays the claims for employees and their dependents up to $45,000. Anything over that is covered by an insurance company.
Macomb has been working with IOA insurance, which raised the city's rates because of the high claims volume.
Torreson said Macomb plans to switch to HM Life, which offered the best quote for premiums.
Torreson said to get back on track the city and employees with family plans will need to contribute 17% more in premiums.
“We are not in bad shape, we are just not as good of shape as we were,” Torreson said. “But we are probably still in a lot better shape than most that are self-insured.”
The city covers the entire premium cost for the individual plans and 75% of family plans with the employee chipping in the remaining 25%. The city maintains 114 total plans with 63 of them being individual and 61 family plans.
The increase will cost employees with family plans $20 extra dollars every two weeks. The city’s share will be more costly ranging between $100-300 depending on the plan.
Last year, the city decided against increasing premium costs. “Last year that was frozen because we were looking so good. This year we are not looking so good,” Torreson said.
Alderman Dave Dorsett advised against keeping premiums at the same level even during good years.
“I really feel going forward we’ve got to plan for steady increases so we don’t have to hit people with 17%, 18% or 19%. It’s hard for them to plan for and it’s hard for us to work with,” Dorsett said.
Mayor Mike Inman said he agreed. The issue will be back on the city council agenda next week.