Columbiana drops self-funded insurance plan

City Council made the decision to switch to a fully insured plan during a special meeting this week, after first hearing from Bob Gearhart Sr. and Bob Gearhart Jr. of DC Wellness.

The Gearharts have been helping the city navigate insurance plans and changes over the last year and a half. Upon their suggestion, the city approved a fully-insured plan through United Healthcare that will cost just more than $800,000 in the first year.

The city is used to spending about $900,000 a year on the self-funded plan over the years, and that figure crept over the $1.1 million mark within the last two years for the city’s 54 full-time employees.

Finance Director Mike Harold had attributed the increase to some serious claims that came in toward the end of 2013.

Mayor Bryan Blakeman has wanted the city to move away from the self-funded plan for years, and was happy to see council make the switch.

“I believe that this change will allow the city to remain financially responsible with its healthcare expenses while ensuring that we can provide great benefits to our employees at a reasonable investment in the future,” he said.

Blakeman went on to thank the city’s insurance committee for “working diligently” to come up with and find a plan with both a high quality healthcare program and long-term cost savings for the city.

He also thanked the AFSCME and OPBA unions and non-union management employees for their “cooperation and desire to search for a lower cost alternative to the self-funded insurance program that has for years plagued the city with high costs,” and the council members who did not agree around this time last year that the change was “necessary nor feasible.”

“I believe that we are further continuing down a path of cooperation that will continue to benefit the residents of the city,” he said.

Around this time last year the Gearharts encouraged the city to remain on the self-funded plan but switch administrators to save money.

The city approved switching from MCA Administrators to Mutual Health Services to save about $400,000 to $500,000.

The Gearharts said the fully insured plan was the best route this time because acquisition costs changed and insurance claims were lower than premium costs.

The fully insured plan will have no deductibles for both single and family plans, but will feature a 100 percent co-insurance, with a maximum out of pocket cost set at $2,500 for single and $7,500 for family.

Gearhart Sr. pointed out that switching administrators was unanimously supported by the insurance committee last year, and switching to the fully-insured plan this year was also unanimously supported by the committee.

The committee consisted of one member of the ACSME And OPBA unions, one non-union member and police Chief Tim Gladis as management representative.

The switch was approved as an emergency to meet the May 1 deadline for enrollment.