City changes health insurance carrier, saves $180,000
The Paso Robles City Council unanimously approved health insurance contracts for all employee groups and elected officials for 2015 at its meeting on Nov. 4. The city’s health insurance contract with Anthem Blue Cross expires on Dec. 31. The current plan is a large group private plan through Gray and Troy Insurance and covers up to 200 people — both current employees and retirees.
According to the staff report, the city’s claims history and annual premium rates have continued to go up with the five-year average premium increase at nearly 15 percent each year. Every year, the city undergoes an extensive evaluation and comparison of alternative plan options with the goal of long-term cost containment. During the evaluation, it was determined that most viable and cost competitive health plan alternative was CalPERS health insurance, which will result in a 7.7 percent savings to the city. City Manager Jim App said that the five-year average premium increase for PERS Health has been six percent annually. With the change to PERS Health, the city will save $180,000 the first year.
The city developed and offered two structures to employees and elected officials. The cost for the private Anthem Blue Cross health plan was approximately $2.4 million for 2014 and the structure approved by the council on Nov. 4 will decrease costs by 7.7 percent for 2015.
The council approved seven resolutions authorizing:
- A contract for Service Employee International — SEIU Local 620
- A contract for Elected Officials
- A contract for Unrepresented Confidential, Professional & Management Group
- A contract for Paso Robles Professional Firefighters — IAFF 4148
- A contract for Paso Robles Police Association
- A contract for Unrepresented Permanent Part Time Employees
- Defined contributions for each of the aforementioned groups
The city’s insurance covers approximately 160 to 200 employees, including those that have retired; elected officials; and their families. App said that the PERS Health has a number of plans with varying benefits and costs. While the city has chosen a few for employees to choose from, employees can choose one with a higher premium, but they would be responsible for picking up the additional costs. He added that half of the employees pay a fixed contribution cost and the other half will pay 25 percent of the premium while the city pays the remaining 75 percent. He said that the police and fire unions wanted to continue with the 75/25 contribution split, while the others eliminated the percentages and went with a fixed contribution. He said that the 75/25 split gives the most savings to the city. All in all, he said, the plans will be roughly the same with PERS Health as they were with Anthem Blue Cross.