Scottsdale employees can expect 1.3% uptick to healthcare premiums next fiscal year

Scottsdale City Hall is at 3939 N. Drinkwater Blvd. in downtown Scottsdale. (File photo)

Scottsdale employees who opt to participate in the municipality’s health care plan can expect a 1.3 percent overall increase to premiums, which equate to an additional $1 to $12 in monthly premiums.

Scottsdale City Council — by a 5 to 2 margin — on Feb. 22 approved Resolution 10709 ensuring the municipality will continue its agreement with Cigna Health Insurance for the 2017-18 fiscal year.

Scottsdale Councilwoman Kathy Littlefield and Councilman Guy Phillips were dissenting votes. The city’s 2017-18 fiscal year begins July 1.

“We still have a risk-averse population,” said Scottsdale Human Resources Manager Lauren Beebe at the public hearing.

“Based on reviewing claims activity over the past 30 months, if no plan or network changes occur, the city needs to adjust plan funding by 4.1 percent or $1.2 million.”

The city of Scottsdale carries a $29.7 million annual cost to provide healthcare to its employees, of which 2,186 employees are covered with about 5,600 members opting to be self-insured.

According to Ms. Beebe, Scottsdale employees contribute $7 million annually, which accounts for 24 percent of the total cost, while taxpayers provide the other 76 percent.

“We have found that 31 percent of our population has a chronic disease,” said Ms. Beebe of data realizations gleaned. “Our No. 1 chronic disease is high blood pressure. About 11 percent of our base has high blood pressure.”

Ms. Beebe points out provisions will be added to the new health care plan encouraging employees to improve their health.

“When people are aware of potential health risks they are more likely to take steps to improve their health,” she said. “Following the city council vote tonight we will begin to communicate with employees.”

Highlights of changes to employee health plans include:

  • Implement a blood pressure incentive of $20 per month;
  • Implement an annual city contribution of $500 to employees enrolled in a health savings account and $1,000 for family coverage;
  • Removal of allergy and heartburn prescriptions;
  • Provide an incentive payment of $120 per employee or $240 per family to those active in the Cigna health reimbursement account;
  • Increase the medical flexible spending account from $2,500 to the IRS maximum of $2,600

Three options offered

The plan approved  by the council was the first of three options presented by staff.

Members of Scottsdale City Council, Ms. Littlefield and Mr. Phillips, expressed support for Option 3, which was also presented to the local governing board.

The third option would have set the premium contribution rates for employees at 20 percent and at 25 percent for families.

The total expected medical costs would have been $29 million, and the city would have paid approximately $4 million more than the option approved by the city.

The civilian vice president of the Police Officers Association of Scottsdale, Darlene Cook, spoke out against the approved option.

When finances were tough for the city, employees were asked to shoulder steep increases in premiums. Not that the city’s financial picture is more stable, she thinks employees should be rewarded for their past sacrifices.

“You know your employees are great; we keep the city moving smoothly,” she told city council. “And, we have been doing so with less since 2008. We shouldered some of those costs proudly with the city. We are very concerned about the impacts (these increases have) on families.”

Matt Heeren, president of the Scottsdale Fraternal Order of Police, echoed many of those same sentiments.

“I do believe there are some areas where we can improve,” he told city council. “I would like to send the message that when times were tough the employees took that on, but when times are good — and it’s only $400,000 — which was half of what the employees shouldered.”

Scottsdale Vice Mayor Suzanne Klapp commended city staff for its in-depth proposal.

“We did not have a great process last year. What I have been seeing your group do this time has been very good.

I really welcome what you are doing here,” she said.

“In general, I like what you have come up with. We have not seen a 1.3 percent increase since I have been on the council.”

Northeast Valley Managing Editor Terrance Thornton can be contacted at tthornton@newszap.com

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