Plan would affect retirees' coverage

May 25, 2006|by ANDREW SCHOTZ


Retired city employees younger than 65 years old would see new premiums, deductibles and prescription coverage under an insurance plan proposed to the Hagerstown City Council.

A few retirees spoke out against the plan Tuesday as the City Council prepared to pass a 2006-07 budget. Many others picketed outside City Hall.

The council postponed a decision on the insurance plan, then passed a $134.6 million budget for the next fiscal year, which begins July 1.


Currently, the city's insurance plan fully covers retirees younger than 65. Under a new proposal, 85 percent of their medical expenses would be covered, and deductibles of $200 for individuals and $500 for families would be added.

Also, the prescription plan would change from a $20 co-pay to a tiered system in which retirees would pay 50 percent of drugs costs of more than $5,000. The plan would cover 100 percent of drug costs of more than $10,000, said Donna Messina, the city's human resources director.

An earlier draft had 80 percent medical coverage, but, after a meeting Thursday with employees to discuss the plan, Mayor Robert E. Bruchey II boosted it to 85 percent, she said. The earlier draft had employees paying 100 percent of prescription costs of more than $15,000.

Besides insurance, the City Council also put off deciding whether to fund a consultant's recommendation to boost city employees' wages. Fully funding the plan is expected to cost about $5 million over three years.

Councilman Lewis C. Metzner said Tuesday that compensation should be considered as part of upcoming negotiations with employees' unions.

Assistant Finance Director Ray Foltz said the four unions' contracts expire July 3.

With a 2006-07 budget in place, the City Council will continue discussing insurance and the wage study.

City officials have said accounting rules on benefits are forcing the city to make changes or possibly face a 20 percent tax increase.

The insurance enrollment period for employees tentatively has been pushed back from June to August. Current coverage will continue until then.

Darlene Strock of Greencastle, Pa., who a Hagerstown Police Department employee for 33 years, told the City Council that retirees are worried how they'll pay under the proposed plan.

In an interview Wednesday, Strock, who retired in 2000, said the new plan "is going to drastically affect a lot of people."

She said it's not fair for new employees to get better coverage than longtime employees who retired.

Current employees are fully covered. Under the proposal, new employees would pay 10 percent of their individual coverage.

Messina said the insurance plan was revamped because current employees subsidize about 80 percent of the costs incurred by retirees older than 65. The new plan would reduce the subsidy to about 25 percent, she said.

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