Mehlville Fire renews insurance with 37-percent hike and higher deductibles

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By Erin Achenbach, Staff Reporter

The Mehlville Fire Protection District renewed its health insurance contract with United Healthcare this year, but employees seeing higher deductibles will get assistance from the district.

The Board of Directors unanimously voted Nov. 18 to offer employee insurance from United Healthcare in 2021 and to establish a Health Reimbursement Arrangement, an employer-funded health benefit plan that reimburses employees for qualified out-of-pocket medical expenses.

Chief Financial Offi cer Brian Bond told the board in October that agent USI Insurance Services increased health-care renewals by 37 percent in 2021, equating to $672,000 in additional premiums for this year.

“Unfortunately that’s just not sustainable for the 2021 budget,” said Bond. “To find a more fiscally palatable option, USI presented an option that involves increasing the deductible.”

Increasing the deductible from $3,000 to $5,000, with a maximum deductible exposure of $5,000 per individual and $10,000 per family, would result in a $220,000 increase in premiums for 2021.

“An employee with individual coverage could see an increase in their deductible of $2,000 a year, and an employee with dependents on their policy could see an increase of $4,000 a year,” said Bond. “The good news is that this type of plan renewal would only result in a $227,000 increase in premiums, which is $444,000 lower than renewing the current plan as is.”

Bond added that while employees paying more on deductibles may be a “frightening concept,” options were available to make it easier for employees.

“If the employee is primarily healthy and doesn’t ever approach the deductible, there’s no additional change to them,” said Bond. “But what thing we could do if the board was open to, we could consider implementing a health reimbursement agreement.”

An HRA is an employer-funded plan that reimburses employees for qualified medical expenses through a third-party administrator, which would protect certain health information and keep employee health issues confidential, said Bond.

One option would allow the district to keep the employee cost at $3,000 and reimburse the employee for any expenses between $3,000 and $5,000. Board Director Aaron Hilmer noted that about 16 years ago when he and Treasurer Bonnie Stegman were elected, the fire board made a number of structural changes to the fire district’s health insurance.

“We put a lot of systematic, structural changes into the health insurance and it wouldn’t have been so successful if we didn’t have great cooperation from the employees that helped it,” said Hilmer. “I think that we should do something that the employees don’t see any difference, we’ll raise the deductible, we’ll cover whatever cost” between $3,000 and $5,000.

At the Dec. 2 board meeting, the board unanimously approved renewing the district’s health insurance with United Healthcare and to establish a Health Reimbursement Arrangement. The district will use payroll company Paylocity, based out of Sunset Hills, as the third-party administrator.