Insurance costs rise for city employees

City employees’ insurance premiums are set to jump 17 percent mainly due to some large claims paid out over the past year, according to officials.
At Tuesday’s council meeting, the City Council approved renewing the city’s health insurance policy with Blue Cross/Blue Shield of Louisiana with a 17 percent increase in premiums. The city’s prior rate is set to expire April 30.
Shelley LeBlanc of Paul’s Agency in Morgan City meets with the city’s insurance committee on a quarterly basis to get an idea of the amount and type of claims, she said. Over the past year, the city has several large claimants on the group who are generating the bulk of the claims, LeBlanc said.
The bulk of the city’s health insurance cost increases were due to some “really hard claims this year,” LeBlanc said. The loss ratio is extremely high, at about 135 percent, because of a relatively small amount of sick people in the group, she said. “Eighty-three percent of the total claims are being generated by 7 percent of your population,” LeBlanc said. However, claims over the past several years had previously been relatively low, she said.
When LeBlanc originally received the renewal proposal from Blue Cross/Blue Shield, it showed a 49 percent rise in premiums, which LeBlanc knew the city couldn’t sustain, she said. After Paul’s Agency requested “rate relief,” the city was immediately given a 10 percent reduction in premiums, Leblanc said. Paul’s Agency eventually got the rate down to a 17 percent increase compared to the prior year, she said. The city pays 100 percent of employee-only health insurance rates and pays a flat rate of the dependent premium, Leblanc said.
The first health insurance plan option increases the deductible from $1,000 to $2,000, but also kicks in a doctor’s office visit copay, LeBlanc said. “That is going to be a huge benefit to the healthy people, basically that just need to go to the doctor and get prescription drugs,” Leblanc said. The employee-only premium will increase from $355 per month to $415 per month, she said.
Morgan City Mayor Frank “Boo” Grizzaffi said the city has prepared a little bit for the increased health insurance costs by budgeting for an 11 percent increase this year. “We have an opportunity to come back at the six-month mark and try to get reevaluated and beat that figure back down,” Grizzaffi said.
The city’s health care renewal is the worst LeBlanc has ever seen with any of the groups she represents, she said. The city has roughly 260 employees enrolled in health insurance, and the number of claims from those employees directly affects insurance rates, LeBlanc said. In 2014, the city’s health insurance renewal was flat, not showing any change in the rate, Councilman Louis Tamporello said.
The council also approved renewing the city’s Health Plan Management Consultant/Servicing Agent Agreement with Paul’s Agency to provide services to assist in administering the city’s health insurance plan at a fee of 3 percent of the total premium per month for the period to end April 30, 2016.
In other business, the council:
—Approved using $1 million in state capital outlay funds for the La. 70 drainage improvements project.
—Approved accepting a bid of $352,470 from Larry Doiron LLC for furnishing all labor, materials and equipment to upgrade the Federal and Bowman Lift Station.
—Voted to table a request from QD Rentals to possibly put an ice-making machine at Lake End Park.
—Approved the planning and zoning commission’s recommendation to expand the commercial zoning designation within Cefalu Subdivision to allow for the building of storage facilities.
—Approved Jerry Hebert to hold a free tennis camp July 6, 8, 13 and 15 at Lawrence Park from 8 a.m. to 9 a.m. each day.
—Approved Woodrow Parker to hold the Aqua Safety First Community Program from noon to 3 p.m. May 2 at Lake End Park pending the recreation commission’s approval.
—Approved the Bayou BBQ Bash to be held under the U.S. 90 bridge in Morgan City July 24-25.
—Approved the South LA Jeep Association to hold its “SLJA Jeepers for Creatures” at Lawrence Park tentatively set for 11 a.m. to 4 p.m. Sept. 26. The event will raise awareness and funds for shelter animals.
—Adopted the city’s 2015 millage rates. The millage rates totaled 17.88 mills on the dollar on the roughly $119 million worth of property in the city.
—Adopted the city’s 2014 amended budget.
—Approved the VFW Buddy Poppy Drive to be held from 10 a.m. to 2 p.m. Saturday.
—Approved declaring surplus vehicles.