City's health insurance hits snag

Grace Bonds, with Craft & Wynne Insurance in Holly Springs, appeared before the mayor and board of aldermen January 18 to express concern about a health insurance rate increase for city and utility department employees.

The deadline had passed for any changes in the policy, Bonds said. The February checks will reflect a 55 percent increase in premiums, she said.

Bonds said she has worked since November to discuss insurance renewal and rates with Mayor Sharon Gipson and had received no follow-up.

Rates have increased significantly, she said.

Employees will get a sticker shock when they see the premium deduction show up on their checks.

In past administrations negotiations on rates and renewal have never been late, Bonds said.

Premium deductions from payroll checks are done a month ahead of time, Bonds said. February premiums are paid January 1. March premiums are paid February 1.

“January 15 was the last date to make changes to coverage,” Bonds said. “Those changes in coverage should be made in January. There’s no way to get that done by February.

“Y’all are in a pickle.” She said there is a reason for rate increases. Employee deductible is $5,000 but gap insurance brings it back down a bit. “You are right, it’s a pickle,” Gipson said. “Everyone was not provided information.” Gipson said she wanted to get quotes from other providers — “to make it a level playing field” for providers. Bonds said the increased premiums take effect February 1 and there is insufficient time to get information or alternate quotes. “So if it’s not paid by February, it’s gone (cancelled),” Bonds said.

If the policy with the city is canceled, employees would lose their insurance.

Gipson said she is looking to see who is enrolled and what “we have or send it back out, to see what our options are.”

Blue Cross Blue Shield’s loss ratio for the city came to 35 percent, Bonds said. That sent rates up 55 percent.

“That’s on me,” said Gipson, taking responsibility for the delay.

City clerk Jerrica Jones was asked to provide the contribution. The city pays 85 percent of the employee’s premium and the employee pays 15 percent.

“But your rates have gone up 55 percent,” Bonds said.

“We’ll look to it, speak to it,” Gipson said.

Alderman Patricia Merriweather expressed concern about the deadline to make a decision.

“February 1 is our next meeting,” she said. “Can changes be made? I’ve never seen (notice of) insurance we were asked to renew or change in October 2021.”

Ward 2 alderman Andre Jones said insurance is required to notify of any changes 60 days in advance.

“I notify 60 days prior to the renewal date,” Bonds said. “I gave more than 60 days.” “It’s on me. We need to look at it further,” Gipson said.

Ward 3 alderman Colter Teel called for an executive session to discuss the insurance situation.

No action was taken either in executive session or upon return to the boardroom. The loss ratio is the amount

the insurer receives in premiums versus the amount the insurer pays out in claims.

A loss ratio of .35 means the paid claims over the premiums collected in a year comes to 35 percent.

The city can request Blue Cross Blue Shield give the city an extension, which would include the 55 percent increases, while the city seeks new quotes, according to Ward 1 alderman Bernita Fountain.