OCEAN CITY – Discussions on town employee medical coverage at this week’s Mayor and City Council meeting had tempers flaring, as the council tossed around drastic proposals in changing employee health benefits.
The town’s current health coverage for employees includes medical, prescription, dental and vision. This coverage will remain but exactly how much the town will cover in costs is left in question.
Human Resources Director Wayne Evans and Kay Moran, health care consultant, presented a benefit and compensation study during this week’s Mayor and City Council meeting. They presented the council with three health insurance alternatives in efforts to cut costs for the town. The alternatives varied in the employee cost share and their spouse and family’s co-share premium.
Councilman Joe Hall, whose family is covered under the city plan, created his own alternative with his first motion to cover a newly hired town employee 100 percent with health insurance, but for spouse and family to only be covered in a 50-50 cost share. The employees would pay half of the difference in coverage for his or her spouse, while the town would cover the other half. Councilman Brent Ashley seconded the motion.
Councilman Lloyd Martin put it into perspective for Hall on what exactly his motion would entail. He explained that if a town employee started off at earning $32,000 a year, has two children and a spouse the costs for health insurance from the town is around $20,000. This motion would require the employee to pay $10,000 of his $32,000 salary, just to pay for health insurance.
“Is that really what you want to do?,” Martin asked. “We want confident employees, we want good people and we want people to be here for 30 years.”
Hall responded that he had all the confidence that with a 50-50 cost share in health insurance, the town would be able to attract qualified applicants.
“Employees with families are the best, most solid employees we have,” Finance Officer Martha Bennett said. “To move away from offering a family coverage benefit of 85/15, which will save you [the town] over half a million dollars a year, would mean we would no longer attract employees with families that live in the community.”
Councilwoman Mary Knight found it hard to believe that the council was attempting to change a system that has already proven to be successful.
“We’re not going to get the employees we deserve to get, we’re basically lowering our standards,” she said. “We’re going to hurt ourselves in the long run with these rash actions we’re taking.”
Councilman Doug Cymek points out the negative impact a drastic change on health insurance could have on the public safety department of the town.
The Ocean City Police Department and Fire Department was well represented at the meeting. The departments are in contract with private unions, concerning their benefits and compensations, due to a referendum passed years ago. That contract with the town will expire next year and any changes to the town’s benefits and compensations made now will effect their re-negotiation for a new contract at a later date.
“You do what you said you’re going to do, and you’re not going to have police officers in January,” Cymek said. “All I ask is review information before you make decisions.”
Cymek said that there is a police department 30 miles away that is understaffed and a risky decision would put the town at risk for loosing its public safety staff.
“The people in this audience [police and fire department] have done a tremendous job of keeping this town safe,” Cymek said. “It is important to keep the staff levels up where they are.”
At this notion, Ashley withdrew his second to Hall’s motion, and the motion died due to lack of a second.
Almost two hours later, the council returned to the topic of health insurance coverage. Joe Hall stated he would lower his initial motion of 50/50 cost share, if someone were willing to meet him in the middle.
His second motion was to continue to offer new hires the preferred provider organization (PPO) health plans for single coverage at an 85/15 cost share and to add spouse and family the employee will pay 25 percent of the total. Hall recommended the health maintenance organization (HMO) plan for single coverage be set at an 90/10 cost share, and to add their spouse and family the individual will pay 80/20, 20 percent of the total.
After running many numbers and figures, the council as well as the audience grew weary.
“Why don’t we just get this down on paper?,” Pillas said.
In a later work session the council will have the figures of different scenarios, including HMO and PPO for individual coverage, as well spouse and family, where they can review the facts before making any decisions.
“I think the taxpayers sent a pretty strong message to the council about getting a handle on spending,” Council President Jim Hall said. “Maybe this isn’t the right vehicle, maybe we will reconsider this.”