Council backs down from insurance cut

METHUEN — City Council voted 5-4 against funding the city’s $17 million group health insurance Monday night, before reversing course minutes later after Mayor D.J. Beauregard warned of a potential government shutdown and promised to explore options.

Councilors sought to promote a discussion of other health insurance options, including the state’s Group Insurance Commission as well as raise the possibility of changing premiums in an effort to find a cheaper way to insure employees.

However, Beauregard immediately warned the council that not approving the insurance could lead to a government shutdown come the first day of the next fiscal year — July 1.

“I will reconsider the vote if I have a verbal yes, we are going to look at our premiums,” Councilor Nicholas DiZoglio said.

Beauregard said Methuen will look at “every option on the table” when it comes to insurance.

“I am happy to vote this through, I think it is more principle at this point,” Councilor Jana Zanni Pesce said. “I think the effort here, mayor, at your discretion is to really put some fire under looking into options for this, not just having it on the table as it has been for years.”

Beauregard agreed.

While DiZoglio advocated for the GIC, Beauregard mentioned concerns raised by outgoing Fire Chief Tim Sheehy about the system during a meeting on June 9.

“I am not going to hammer the GIC, but right now, the GIC is not the answer,” said Sheehy said. “They are losing $20 million a month and they are not paying their providers.”

“Right now I would stay away from it,” he said.

Nearby communities offering GIC health insurance include Haverhill, Lawrence, North Andover and Groveland, according to the state’s website. Haverhill Mayor Melinda Barrett said the GIC had saved the city “a lot” of money over the course of a few years, but rates were increasing “precipitously” with a 10% increase last year and a 13% increase this year.

Though she said insurance in general had increased significantly, with many blaming new weight loss drugs on the jump.

“It doesn’t seem like anybody’s rates have gone down recently,” said Barrett. “Hopefully things stabilize in the market.”

She said Haverhill had one more year with the GIC before their plan was up at which point a consultant would evaluate if it was still the best option. Barrett added any new choice would also need the approval from the relevant unions.

“We will definitely look around,” she said.

Councilors Allison Saffie and Joel Faretra remained a no vote on the insurance expenses during the second vote, while DiZoglio abstained.

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