City barred from dropping councilman from healthcare plan

WOOSTER — A member of Wooster City Council has been granted a preliminary injunction barring the city and its healthcare insurance broker from terminating his coverage.

Wayne County Common Pleas Court Judge Corey Spitler on Wednesday granted the request of Ward 4 Councilman Scott Myers, who enrolled in the city’s plan for 2018 and was notified on July 27 that a compliance audit found the city had no legal authority to offer that benefit to council members. Myers filled for the temporary restraining order on Wednesday.

City administration director Joel Montgomery said on Friday “we don’t know why it was in the plan document from years and years ago,” but it had gone unnoticed because no council member had ever asked to enroll in the coverage.

Part of the initial issue was that council had never adopted legislation allowing for its members to enroll in the city’s plan. Now, Montgomery and deputy law director Kevin Gibbons agree that even if such legislation was enacted, it would raise a number of legal issues that could end up costing the city upwards of $800,000 per year to address.

In a July 27 letter to Myers, Montgomery said the language of the plan “had never undergone legal review for compliance and/​or (Affordable Care Act) compliance.”

When Myers enrolled, Montgomery wrote, “several items required clarification, therefore the insurance broker and outside legal counsel review the administration of the benefits to ensure the city was in compliance.”

Without the legislation, it was not.

Montgomery said attorney William Hanna, of Walter-Haverfield, advised Myers be taken off the plan immediately but that Mayor Bob Breneman wanted to provide the councilman adequate time to find other coverage so they first planned to use an industry standard of 60 days’ notices and because the 60 days would end close to the end of a month, extended it beyond that through October.

“That’s what’s fair,” Montgomery said. “That’s what the mayor decided was the fair thing.”

But Myers, who was paying a self-pay premium of roughly $2,000 per month, claims in a brief in support of the injunction he has taken steps to obtain coverage but “every potential policy under the Affordable Care Act is far more expensive and provides far less coverage than the city’s plan.” In addition, Myers’s wife “suffers with multiple medical conditions for which continued treatment by her same specialists is extremely important,” according to the brief. Those providers are not included in the policies available under the ACA, Myers maintains.

Former council member and attorney Barbara Knapic is representing Myers and said her client wants to maintain his coverage through the end of the year and hopes that before then City Council will pass the legislation necessary to allow him to remain on it beyond that. “At this point,” she said, “I don’t know what his intentions are if (the legislation) doesn’t pass.”

That legislation was requested by Laws & Ordinances Committee Chairman Craig Sanders, one of council’s at-large members, and is scheduled for introduction at Monday’s regular meeting.

It went out to council members with a memo from Gibbons, who warned there are “complex issues of federal regulatory law” that may bring legal ramifications should the legislation be adopted.

“If council votes for health care, then the city’s health care plan document will have to be rewritten to include them. There is no designation of ‘elected officials’ under the ACA (or other federal law),” Gibbons wrote. “Health care plans are designed for employees, which raises the question: are elected officials (such as members of council) considered employees under the ACA?”

If council members are considered employees, they would be part-time employees and then “it seems certain that the city will be required under the ACA to offer health care coverage to all employees who work less than 30 hours per week.

And the ACA’s non-discrimination clause may require the city offer the same benefits at the same rate to all employees, so there would no longer be a self-pay premium, per Gibbons’s memo.

Offering Myers healthcare could potentially open a can of worms that Montgomery said will cost the city thousands of dollars. Because the city is self-insured to a stop-loss of $85,000 before coverage is shifted to a separate plan, offering healthcare to every employee would cost more than just the city’s share of the premiums. And further, he said, if everyone has equal access to benefits, that may extend to benefits beyond basic healthcare, such as retirement benefits and dental and optical provisions.

That, Montgomery said, would add roughly $400,000 or more to the city’s budget. “And over the next year, I would seriously have to consider how we can reconfigure our workforce,” he said, since it would make more sense to eliminate some of the high-cost part-time positions in favor of full-time positions. That, he said, could potentially cost another $400,000.

Knapic said she has heard talk of all the unintended consequences the city believes would occur as a result of offering council members health care benefits. But, she added, the city hasn’t provided any evidence or cited any authority “that would indicate that these unintended consequences are imminent, or even likely. I intend to do my own research on this subject so that I can provide my client with as much information as possible.”

She also has advised Myers against making public comment on the subject.

Gibbons said he expects a hearing on a permanent injunction to be scheduled for sometime this month. Spitler has recused himself, as has Judge Mark K. Wiest. As administrative judge, Wiest will contact the Ohio Supreme Court and arrange for a visiting judge to preside at the hearing.

Reporter Tami Mosser can be reached at 330-287-1655 or [email protected].

CREDIT: TAMI MOSSER