Tuesday, November 15, 2011

City Council Stiffs Employees Yet Again on Health Insurance

San Angelo City workers and retirees must be tired of the beating from this City Council on health insurance.  Last year this mendacious crew forced the lion's share of $960,000 in 2011 cost increases on employees, early retirees and their dependents.  Workers bore 76% of the total $1.2 million in projected increases.

At the time key City leaders knew of a projected $550,000 in federal Early Retiree Reimbursement Program (ERRP) funds, but chose to keep it secret.  When challenged by Russell Smith and myself, elected leaders sat on their ERRP, passing draconian premium increases for dependent coverage.

As predicted, scores of city workers/retirees dropped health insurance.  Nearly 200 fell from the rolls of the insured, saving the city $190,000 in 2011.   Council never mentioned these savings in a public meeting.

The city has $1.15 million to put to bear on health insurance.  Here's the breakdown:
1) $190,000 savings from city workers and retirees dropping health insurance for 2011. (Unless they already spent it on something else)

2) $480,000 in ERRP money, of which $330,000 from 2010 early retiree claims sits in a city bank account.  (This can only be spent on health insurance, reducing premiums or increasing benefits)

3) Expected savings of $483,000 from Aetna plan with SACMC EPO for 2012.

Council met today to talk about using these funds.  City leaders reneged on their prior intent to use ERRP funds in 2012, instead sticking them in a rainy day fund with earliest use in 2013.

Fast forward to 2012 where Council plans to pocket most of any $673,000 in elective savings.   The City plans to return a mere $197,000 (29%) to employees/retirees, keeping 71% for the city's "plan fund balance, which at nearly $1 million is about $400,000 short of its 75-day goal."

Is the "plan fund balance" for health insurance or capital budget items?  I would bet the latter, given Harold Dominguez's propensity to hide things with obtuse language.  Here's how fair this council has been to employees/retirees:

Increased costs:
76% employees/retirees
24% city

Cost savings:
29% employees/retirees
71% city

The city dishes out three of four lashes to workers/retirees, then takes three of their four potential prizes.  Those who make the rules win the game.


Anonymous said...


PEU Report/State of the Division said...

Thanks for the head's up anonymous.