High-Deductible Insurance Change Could Mean Big Legal Bills

If the Mount Pleasant Village Board sticks with the insurance plan in the proposed 2013 budget, the village could squander any potential savings on legal bills.

Municipal employees now get their health insurance through the state plan, but last month trustees approved a resolution to withdraw from the state insurance to give village leaders the opportunity to shop around for better plans at better prices.

Instead, what trustees have is a high-deductible health savings plan figured into the 2013 village budget with a savings of about $646,000. This plan was found and initiated by former Village President Carolyn Milkie and former Interim Administrator Mark Morien, both of whom resigned last month.

Because the state insurance plan was covered in the South Shore collective bargaining agreement signed last year, the fire union could file an injunction to halt the switch.

"That stops any changes, but it also means lawyer fees for both sides," union President William Miller acknowledged. "Nobody wants that."

The HSA plan includes deductibles of $2,000 for an individual and $4,000 for a family and out-of-pocket maximums of $4,000 and $8,000, respectively. Premiums are expected to remain relatively stable at current rates of about $150 per pay period for family coverage.

Trustee Karen Albeck is retired from Racine Unified and covered under a similar plan from the district. She said she's not alone when it comes to a tightened household budget.

"This plan is killing me financially," she said last week at a budget workshop meeting. "I strongly recommend that we stay with the state plan for another year and take the time to really shop around for plans that will work for our employees."

Trustee John Hewitt is also concerned with how employees could be impacted, and he suggested Monday that the village fund health reimbursement accounts to help offset the costs to employees.

"I know other communities who are switching to these types of plans and funding accounts to help their employees," he said. "I would advocate for that."

Insurance Savings Help Fund Capital Projects

While legal and court fees are certainly a consideration, that $646,000 is figured into the budget to help pay for a host of capital purchases and projects including a snow plow, new police squad cars, a new ambulance, computers, and more $1 million in road work.

"We would definitely have to re-examine our proposed capital purchases," Albeck said. "But, given the alternative of going with this health plan, I think that can't be avoided."

The Village Board is scheduled to meet again at 9 a.m. Friday to finish the discussion about health insurance. Because the $16.9 million 2013 budget is scheduled to be published Friday, trustees can revise the budget, but they cannot make changes that would result in a higher tax levy; however, they can always decrease the levy.