City elects to leave state health insurance plan

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The Hudson City Council voted unanimously Monday night to withdraw the city from the state’s Local Government Employers’ Health Insurance Plan.

Instead, the city will pursue enrolling its 75 employees in the Preferred One health insurance network for an estimated 2009 general fund savings of $289,387.

The savings could add up to $396,271 or more when the water utility and wastewater treatment department funds are included, city officials said.

The city has made a couple of previous attempts to get out of the expensive state insurance plan. Each time it ran into trouble getting the information it needed or meeting the yearly deadline for bowing out, however.

This year, the City Council contracted with Associated Financial Group to assist with the process.

Preferred One is the plan the consultant recommended that the city go with.

According to an issue sheet provided by City Administrator Devin Willi, the city would pay $1,487,499 in premiums for all its employees in 2009 under the state plan.

The premiums for all employees (including water and sewer) under the Preferred One plan are expected to be $1,091,228.

The Preferred One plan would have a $2,000 deductible for the 14 employees with single policies and a $4,000 deductible for the 61 employees with family policies.

The city would establish health reimbursement accounts for employees to cover all or some portion of their deductibles.

The amount the city would contribute to the employee HRAs would be negotiated with the employee unions.

Union approval of the plan to go with Preferred One is still needed.

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