The City of Dillingham is contending with an unexpected and substantial 37.17% increase in health insurance costs, significantly surpassing the initially budgeted 10% rise. The city’s previous medical insurance plan, Heritage Select with Premera Blue Cross Blue Shield, concluded at the end of the previous year. In response, Dillingham’s city council, in a unanimous decision during their December meeting, opted to continue coverage through Premera Blue Cross Blue Shield. This decision ensures full coverage for employees and 90% coverage for their dependents, maintaining the city’s commitment to comprehensive health benefits.
The urgency of this decision was emphasized by Dillingham’s finance director, Anita Fuller, who highlighted the need to provide sufficient time for employees to choose open enrollment. Fuller presented cost-effective alternatives during the meeting, including the option to switch to another provider, Moda, which offered similar coverage. However, such a move would have incurred a more modest 19% increase in insurance rates compared to Premera’s 37.17%.
Despite the potential savings, Fuller pointed out that transitioning to Moda might cause disruptions for employees. According to the city’s insurance broker, RISQ, some healthcare providers expressed dissatisfaction with payment delays from Moda.
Fuller also explored options to mitigate costs while retaining Premera Blue Cross Blue Shield, suggesting a reduction in the amount the city covers for employees’ dependents. Additionally, she mentioned the possibility of the city’s insurance broker negotiating for a lower rate with Premera.
Council member Kaleb Westfall highlighted the attractiveness of the city’s comprehensive insurance plan for employees, emphasizing that any savings from reducing coverage levels would be modest. Council member Bert Luckhurst concurred with this sentiment. Notably, the City of Dillingham is currently in the process of hiring for several positions, further underscoring the importance of maintaining competitive and appealing benefits for prospective employees.
