The City of Dillingham is grappling with a substantial 37.17% increase in health insurance costs, far exceeding the 10% rise the city originally budgeted for.
The city's former medical insurance plan, Heritage Select with Premera Blue Cross Blue Shield, was dissolved at the end of last year. In their December meeting, Dillingham's city council voted unanimously to continue providing coverage through Premera Blue Cross Blue Shield. As before, they will offer full coverage for employees and 90% coverage to their dependents.
At the meeting, Dillingham's finance director Anita Fuller said the decision needed to come quickly, as the city needed to provide time for employees to choose open enrollment if they wished.
Fuller presented cheaper alternatives at the meeting, including switching to another provider, Moda. She said Moda offered similar coverage. The move would have incurred an approximately 19% increase in insurance rates, compared to Premera's 37.17%.
Fuller said, however, that the transition to Moda would cause some disruption for employees and that according to the city's insurance broker RISQ, some healthcare providers were unhappy with payment delays from Moda.
Fuller also offered options for reducing costs for the city while staying with Premera Blue Cross Blue Shield by reducing the amount the city covers for employees’ dependents.
Further, Fuller said that the city’s insurance broker could continue to negotiate for a lower rate if Dillingham chose to continue with Premera.
Council member Kaleb Westfall said that the city’s comprehensive insurance plan was one of the attractions for employees and that the city would see only modest savings from reducing the level of coverage. Council member Bert Luckhurst agreed. The city is currently hiring for several positions.
Get in touch with the author at christina@kdlg.org or 907-842-2200.
