Crestwood employees face paying more for insurance or receiving fewer benefits


Crestwood employees will have to choose between paying more for health benefits or receiving less of them during the next fiscal year, the city administrator said last week.

The cost to keep the same benefit plan next year with the city’s current health-insurance provider, Anthem Blue Cross and Blue Shield, would increase 26 percent over fiscal 2009, City Administrator Jim Eckrich told the Board of Aldermen May 26.

However, the city left room in its budget to increase its contribution to the premium by only 15 percent, or $86,056. If the city retains the current benefit plan, employees would see a 63-percent increase in their part of the premium, Eckrich said.

The total health insurance cost for fiscal 2009 was $825,314.12. Of that amount, the city contributed $653,686.52 and employees paid $171,627.60. The cost for the city to self-insure part of the employee

deductible was $80,000.

Under Anthem’s proposal for fiscal 2010, the total cost would jump to $1,014,096.84.

The city would pay a total of $659,742.72, as well an anticipated $75,000 to self-insure part of the deductible. Employees would pay a total of $279,354.12.

Information provided to the board last week showed the city has switched health insurance providers three times in the last five years, which Eckrich said helps re-duce both city and employee costs.

The city moved from Blue Cross and Blue Shield to Group Health Plan in fiscal 2007, from GHP to United Healthcare in fiscal 2008 and from United Healthcare to Anthem in fiscal 2009.

However, this money-saving approach has made the city unattractive to prospective providers, Eckrich said.

Because the city boasts what he called an “unstable resume,” no providers, other than Anthem, would submit bids for a health insurance contract this time around without individual employee underwriting. When employees provided underwriting for two insurance providers, only one submitted a bid in return — and that proposal was more expensive than Anthem’s.

The city seeks contract proposals every year through its health insurance broker, the Todd Organization.

At the May 26 board meeting, Ward 3 Alderman Paul Duchild asked Eckrich if, as an alternative, there were any health insurance pools around the area into which the city could enter with other municipalities. Eckrich said he knew of one being created, but he added that there were “positives and negatives” to joining it.

“The process of that (pool) being created was already started prior to me becoming city administrator, and we hadn’t participated in it,” Eckrich said. “I’m not sure whether it’s a good thing or a bad thing. It has taken a long time to get going.”

Duchild suggested the city look into a plan that employs health savings accounts, or HSAs, which he said could greatly reduce costs.

A group of employees representing each of the city’s departments have been meeting to discuss whether they should absorb the 63-percent hike or settle for benefit reductions, Eckrich said.

The Board of Aldermen likely will hash out a health insurance contract at its June 9 meeting to implement it on July 1.