Employees Pinched by City Budget Woes
By Carl Wagenfohr
CLEARWATER It's not only users of Clearwater's library and recreation services who are feeling squeezed by the reduction municipal tax revenues; city employees are bearing the burden as well.
The first were Clearwater's firefighters, whose labor dispute was recently decided by a City Council imposition of a 1.5-percent bonus for fiscal year 2007/08 rather than the 3-percent general wage increase that had been budgeted in 2007.
Now, all employees will shoulder the burden of increased cost of the city's health care benefits for 2009.
As reported in the September 11 edition of the Gazette, Humana, the city's current health care insurance provider, proposed a 44-percent rate increase for next year. That, coupled with the city having budgeted no increase in its contribution for employee health care, caused Clearwater's Employee Benefits Committee to recommend issuing a competitive Request For Proposal, hoping for a better price.
Only three insurers responded Humana, United and Cigna, and after rounds of negotiations and benefit plan restructuring, Cigna's proposal, with its $2,413,541 (16.6-percent) premium increase, was recommended by the Benefits Committee.
But if it were a beauty pageant, the winner was not one you would have liked to kiss. Included were rate increases that will be borne by employees, higher co-pays and out-of-pocket maximums than past plans and, for the first time, a basic plan with annual deductibles of $750 for an individual and $1500 for a family.
City employees, largely insulated from the rapid increase in health care cost in recent years, will be sharing that burden with taxpayers to a greater extent in 2009. Of the $16.9-million total cost of 2009 health insurance, employees will pay $5.3-million, bearing the entire $2.4-million increase, while the city's share will remain at $11.6-million.
Compared to the Standard HMO offered last year, 2009's new Base HMO is quite a step backward in coverage. Where the former plan had no deductibles, there will be a $750/individual $1500/family annual deductible for 2009, and higher copays for office visits, emergency room, ambulance, diagnostics and drugs. Employee costs will remain the same as last year's Standard HMO plan, with annual employee costs at $0 for employee-only, $2193 for employee+1 and $4619 for employee+family coverage.
The new Standard HMO, while continuing with no annual deductible, features higher annual out-of-pocket maximums and co-pays for essentially all medical services. Those reduced benefits will come with an increased price tag, with the annual employee cost of coverage increasing from $0 to $1007 for employee-only coverage, from $2193 to $3926 for employee+1, and from $4619 to $7470 for employee+family.
The city will contribute $5100 for employee-only, $6580 for employee+1 and $9815 for employee+family coverage, regardless of which benefit plan the employee selects for 2009.
2009's increased cost and reduced benefits will be difficult for many of the city's employees to bear. In a letter to the City Council asking for an increase in the city's contribution to employee health insurance, a Clearwater Firefighter wrote,
My premiums this year will be going from $384.91 per month to $622.51, an increase to me of $237.60 per month. The city will have no increased contribution to my insurance this year. I have a hard time with this, especially since I have not had a cost of living pay raise since October 1, 2006, with no pay raise in sight. The bonus imposed on us this past month will do nothing to assist me with the huge premium increase I am facing this coming year. With the ever rising cost of everyday sundries this is a huge amount of money for me to absorb.
During Monday's City Council worksession, not a single elected official expressed any support for increasing the city's contribution to employee health care.
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