Health benefits to change

June 02, 2004|by GREGORY T. SIMMONS

Changes to the City of Hagerstown's health-benefit system will be instituted to cover rising health-care costs, city Human Resources Director Donna Messina said Tuesday.

The City Council adopted a set of recommendations presented Tuesday by Messina.

The changes include a 10 percent increase in premiums and an increase in most prescription co-pays. The changes will take effect July 1.

The recommendations were a result of the annual review of city health-care costs by a committee of city employees.

Messina called the changes an "incremental increase" designed to avert a large premium increase such as the 39 percent increase the city faced four years ago.


"We still have to face the numbers and somehow get control of this cost," Messina said after the meeting. "We're trying to be responsible."

According to human resources department information, the city manages about 750 health-care contracts. The contracts include those of active employees and retirees, and a contract can include one person or a family, Messina said.

The health benefits are paid with city tax dollars, city utility user fees and employee contributions, Messina said.

Messina said the city's overall health-care costs for the fiscal 2005 budget are expected to increase 10 percent to about $5.1 million. The cost increases are a result of the increase in premium charges, Messina said.

Premium charges are the payments that cover the cost of doctor visits, hospital stays and drugs.

Any employees or retirees on the city's health plans who have dependents face an increase of 10 percent in the premiums they pay for their dependents, Messina said.

For example, if a premium were $60 a week for full family coverage, that coverage would cost $66 under the premium increase to take effect July 1, Messina said.

Not all participants will notice a difference in increased premium charges because the city pays 100 percent of premiums for single employees and retirees without dependents until death, Messina said.

The other change in the city's health plan is in participants' co-pay for each prescription, Messina said.

Under current policy, the city's three health plans have nine levels of prescription co-pays. Beginning in July, everyone will have the same co-pay: $6 for generic drugs, $24 for some brand-name drugs and $42 for other selected brand-name drugs.

The change is to encourage generic-brand use, which can cut costs, and should even out the burden for prescription costs, Messina said.

Active employees in the most widely used plan are taking a heavier burden of the overall health-care costs than employees and retirees in other plans under the current policy, Messina said.

After the briefing Tuesday, some council members had questions for Messina, but none voiced opposition.

"I have no problems with this at all," Councilman Lewis C. Metzner said.

After hearing that the city would encourage mail-ordering for prescriptions, Councilwoman Penny M. Nigh said her husband had a "nightmare" when he had to pay for medications he didn't order via mail.

Messina assured the council that her department would be available for any questions about the policy changes.

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