$7.8M health insurance bid for Wilkes-Barre employees put on hold [The Citizens' Voice, Wilkes-Barre, Pa.]

Oct. 14—WILKES-BARRE — City employee health care coverage for 2023 remains in limbo after council removed a resolution authorizing a $7.8 million contract with Highmark from Thursday night's meeting agenda.

"It was pulled because a majority of council wanted it to be pulled," Chairwoman Beth Gilbert McBride told resident Sam Troy in response to his inquiry during public comment.

City Administrator Charles McCormick had told council at Tuesday's work session that the administration advertised requests for proposals in June and asked Joyce Insurance — Risk Strategies to accept and review the proposals because of the company's expertise.

Bill Joyce had told council that only Highmark and Bennecon responded to the RFP, and Joyce — Risk Strategies negotiated with Highmark and was able to get the insurer to knock off "a couple hundred thousand dollars" from the initial proposal, which still amounted to a 3.2% increase over this year's premiums.

McBride had said the facts that the administration had never before sought council's authorization for health insurance and had not previously used a broker to find a health insurance provider "raised a red flag" for her. She questioned whether McCormick's statement that no fees or commissions were included in the contract were accurate.

Mayor George Brown, who did not attend the Tuesday work session, said Thursday that Highmark's initial proposal amounted to an approximate 7% increase in premiums.

"Risk Strategies went back and was able to negotiate a 3% increase. By working with them, we saved about 4% over the cost of health care coverage for 2023. Wilkes-Barre is not paying a dime to Risk Strategies. That's being paid by ... Highmark," Brown said.

The mayor said Risk Strategies provides services that may be utilized by the human resources department, but he is not downsizing the department.

"The benefit here is that we have experienced people that are brokers and now can go out and look at other parts of the area for competitive bids going forward," Brown said.

Councilman Bill Barrett said limiting the premium increase to 3.2% by "using experts" to negotiate and not having to pay the broker out of pocket was reason enough to authorize the agreement.

Councilman Tony Brooks said he asked that the resolution be pulled because city employees and retirees had asked him questions about the insurance situation that he was unable to answer.

Councilman John Marconi said he also wanted to get more information so he could make a more informed decision.

McBride said she still has outstanding concerns she wants addressed before putting it to a vote.

"I don't know if HR is in favor of this. I know they've been consulted, but I don't know their position on it," McBride said. "And just overall, I would like some more transparency throughout the process. I'm hopeful that we can move forward with a plan in the next few weeks or month."

City attorney Tim Henry noted that health insurance premiums account for about 13% of the $53.4 million city budget.

"This is a major expenditure. Nobody in City Hall has the expertise that Risk Strategies has. I think it was a wise decision on the mayor's behalf to have an expert involved in this process. Maybe the way we used to do it was the wrong way of doing it," Henry said. "I think it was absolutely correct to have an expert oversee a purchase this substantial."

Brown asked that council authorize the agreement as soon as possible because an open enrollment period is coming up.

"The people that are going to be signing up have to know what the costs are, and other things," Brown said.

Employers generally begin open enrollment periods in mid to late November.

McBride said there's been a lot of confusion on the topic.

"First of all, on Tuesday, it was said that the administration wanted to give council enough time to vote on this and not wait until the last minute in December because the contract starts in January. But tonight, we're told we need to vote on this as soon as possible because open enrollment is being pushed up," McBride said.

Brown said the open enrollment period was pushed back so the resolution could be put before council for approval. He said the mistake of failing to seek council's approval for more than 20 years is being corrected after it was brought to his attention.

Contact the writer:

[email protected]

570-821-2110, @MocarskyCV

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