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Council does about-face on health insurance

  • Wednesday, May 28, 2014

Eileen Keithly/For South Strand News City Human Resources Director Suzanne Abed-El-Latif is explaining to council that if it reverses its decision to go with the state plan, there will be a mandatory four-year waiting period to re-apply.  

The Georgetown City Council last week reversed its decision to enroll city employees in the state’s health plan, voting to keep its current employee health insurance plan with Blue Cross Blue Shield, a move that will cost the city another $150,000 in its pending 2014-2015 budget.

The council voted 4-3 last Thursday to rescind its May 14 decision to move city employees to the state health plan, which would have cost city employees another $108 per month for family coverage and an extra $34 per month for an individual.

Councilman Rudolph Bradley, who had earlier voted with a 5-2 majority to enroll in the state plan, called for reconsideration of the May 14 vote. He was joined by Councilman Clarence Smalls, who also had supported enrollment in the state plan, Councilwoman Peggy Wayne and Councilman Brendon Barber in rescinding the action.

Mayor Jack Scoville, Councilwoman Carol Jayroe and Councilman Ed Kimbrough maintained their support for joining the state plan, which would have been less costly to the city than the Blue Cross Blue Shield plan.

“I have weighed everything that has been given to me on the state plan, and I am not satisfied,” Bradley said in asking the council to rescind its action. He said coverage for city employees would be reduced under the state health plan.

However, Councilman Kimbrough warned, “I’m not sure the city can contribute (to employee premiums) at the rate we are going.” He was referring to the city subsidizing more than 80 percent of employee health insurance costs.

The council’s decision has implications for the proposed 2014-2015 budget, which was on the Thursday agenda for preliminary approval. The city administration now will have to rework the budget to allocate another $150,000 to employee health insurance costs, reflecting a 28 percent increase in premiums charged by Blue Cross Blue Shield. That was a driving factor in the city’s earlier decision to move to the state health plan.

City Administrator Chris Carter said departmental budgets will have to be reworked before the budget is resubmitted to the council for consideration at its upcoming Friday meeting.

The key issue in the health insurance coverage question is how much city employees should contribute to their monthly premiums. Currently, the monthly premium for a single employee is $390, with the city paying $341 (87%) and the employee paying $49 (13%). The monthly premium for family coverage is $1,048, with the city paying $879 (84%) and the employee paying $169 (16%). Carter has said previously, “You won’t see dependent coverage like this in any other city.”

In a strongly worded email to Carter and Mayor Scoville after Thursday’s vote, Councilman Kimbrough said, “Citizens are seeing an increase yearly in their health care cost but our council seems to think that our city employees do not deserve the same. This is wrong. The taxpayers should not foot the bill for the increase.” Rather, Kimbrough said, “the employee should pick up the additional premiums to help offset the 28% increase. I strongly recommend a 28% increase across the board … This would result in an approximate in $6.33 biweekly for the employee.”

Councilman Barber, however, said at the Thursday meeting that requiring city workers to absorb the premium increase would unfairly hurt lower-paid employees such as sanitation workers and entry-level employees, who would have to contribute a disproportionate share of their paychecks to their health insurance.

The 28 percent premium increase by Blue Cross Blue Shield was the result of several large claims in the last year. City officials sought to avoid that premium increase by moving to the state health plan, which would have raised employee premiums – including a tobacco surcharge of $40 per month for single employees who smoke on top of the $34 increase in premiums compared with their current plan. In addition, the state plan does not cover general preventive care office visits. With its decision to withdraw from the state plan last week, the city will now have to wait four years to reapply if it chooses to do so, under state regulations.

In effect, the Thursday decision by the council means city employees will remain covered by Blue Cross Blue Shield for the foreseeable future – and the remaining question is who will pay for the premium increase.

In another matter Thursday, the council heard a request from the Winyah Auditorium Board of Directors for the city to participate financially in supporting the auditorium, including consideration of taking over its operations. The board told the council it is behind on property taxes and other fees for the auditorium, and it costs $350 per day just to keep the doors open. The council took no action on the board’s request.

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