City’s insurance cost increases [The High Point Enterprise, N.C.]

Dec. 26--HIGH POINT -- A new contract for city employees' health insurance coverage includes a cost increase of 5.44 percent to the city.

The City Council has approved a one-year renewal with current insurance carrier Cigna Corp. for April 1, 2012, through March 31, 2013.

The $12.9 million contract covers health and dental insurance for employees and maintains employee and retiree premiums and plan benefits at current levels.

The city's monthly health and dental contribution will increase from $6,072 to $6,420 annually for each eligible position, effective July 1.

The monthly contribution increases will amount to a total health and dental insurance budget increase of $363,360 for the city.

"I've been in the business for 30 years, and I've never seen a year when the health care costs didn't go up," said John McCrary, the city's director of human resources.

The contract will not pass along the increased costs to retirees, which has been the city's typical practice. This will allow the city to use $286,025 that has been refunded to the city to date and an additional $75,000 estimated to be refunded by April 1 through the city's participation in an early retiree reinsurance program administered by the U.S. Department of Health and Human Services.

The contract renewal maintains the city's "grandfathered" status with respect to the federal Patient Protection and Affordable Care Act, which is the subject of several legal challenges that aren't expected to be settled by the Supreme Court until next summer.

With all of the uncertainty facing the new legislation, officials said it's in the best interests of the city to continue its contract with Cigna for another year rather than solicit bids from other companies in the hopes of getting a less expensive deal.

"I think a lot of plans are saying they want to keep their grandfathered status as a precaution," said Paul Goldbeck of AON Corp., a risk-management services firm that helped negotiate the contract renewal. "We still have 2,000 pages of regulations yet to take effect."

[email protected] -- 888-3531

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