The City of Columbus will decrease the taxpayers’ share of rising health care costs by an estimated $500,000 next year through changes that include increasing the employee contribution amount while still offering very competitive rates and excellent benefits. The City’s Board of Public Works and Safety approved the changes at its regular weekly meeting Tuesday, November 5th.
The City is self-insured and has seen its health care benefits continue to increase in cost over the past few years. From 2010 to 2012, the total plan costs increased from $4.15 million to $5.23 million, a 26 percent increase over the two years. During that same time period, employees have paid the same 7.2 percent contribution for health care premiums. The City of Columbus has been self-insured for at least 20 years, and it continues to offer the most cost effective method to provide employee health care benefits. The City has explored the cost of being insured through a private carrier, but has found that doing so is significantly more expensive than maintaining its own insurance benefits.
Changes approved by the Board of Works increased the employee contribution for the first time in five years and will require employees to pay specific rates that amount to a 10 percent contribution. These rates remain very favorable when compared to the national average for employees’ share of premiums, which is about 28 percent.
“This was a necessary step, and when we compare ourselves to others we are still offering very competitive benefits,” said Mayor Kristen Brown, a member of the Board of Works. “Employees in both the public and private sectors have had to share in the increase of health care costs, and our employees will share some of our cost increases with the taxpayers. We continue to explore ways that minimize the cost to our employees.”
The 2014 City of Columbus employee premium contribution rates:
- Employee only, $33.24 per pay (currently $23.92 per pay) with an annual impact of $242.32.
- Employee and spouse, $73.12 per pay (currently $52.22 per pay) with an annual impact of $543.40.
- Employee and dependent, $61.49 per pay (currently $44.06 per pay) with an annual impact of $453.18.
- Family, $83.09 per pay (currently $59.59 per pay) with an annual impact of $611.00.
The new rates will decrease the City’s costs by an estimated $180,000. Other changes approved by the Board of Works and their savings include:
- Increase the deductible from $500 for a single employee and $1,000 for a family to $750 for a single employee and $1,500 for a family. The increase will also raise coinsurance (maximum amount out-of-pocket costs) from $3,000 for a single employee and $6,000 for a family to $4,000 for a single employee and $8,000 for a family. These changes equal a decrease in cost by an estimated $175,000.
- Implement a spousal carve out for spouses employed elsewhere with benefits, a decrease in cost by an estimated $125,000.
- Change physical therapy/occupational therapy/and speech-cognitive therapy from 90 percent coverage to 80 percent coverage, a decrease in cost by an estimated $35,000.
The total projected 2014 plan decrease in cost for the City is projected to be an estimated $515,000. The Board of Works acted on recommendations from the City’s Insurance Review Committee, which is comprised of three appointments by the Mayor, three appointments by the City Council, and members representing the Fire, Parks and Recreation, and Utilities departments. The City Council, Board of Public Works and Safety and other part-time employees are not eligible to receive the City’s health care benefits.