The Town of Marana is getting a price break on its health insurance premiums, saving town government $275,000 a year and its employees about $66,000, according to assistant town manager Deb Thalasitis.
The town took its major health insurance offerings to bid. One result is that health insurance policy expenses are expected to be 10 percent lower in the new insurance year.
"This is the first time in a long time I’ve been able to stand before anybody and talk about really, really good news on health insurance," Thalasitis told the town council last week. "I don’t think there’s another entity that’s going to have a rate decrease."
"It’s nice to see something where we actually save some money for a change," Mayor Ed Honea said.
Marana’s total annual health insurance expense is near $2.9 million, with about $300,000 of that total paid by employees, Thalasitis said. It is "the big-ticket item" in insurance provision for the town’s 335 covered lives — employees and their dependents.
The firm CIGNA submitted "a significantly lower proposal" than Marana’s current provider, Blue Cross / Blue Shield of Arizona, for health insurance.
"They’ve been an excellent provider," Thalasitis said of Blue Cross / Blue Shield. "It’s no reflection on their service."
She told the council "there is no change in the plan design." It has the same co-pays and benefits. There is a "potential change in providers," though more than 97 percent of CIGNA’s providers are on the Blue Cross / Blue Shield list of providers.
Marana has a two-tiered health insurance plan. The town covers 95 to 100 percent of an employee’s premium costs under those plans, and 80 percent of the cost for an employee’s dependents.
"We are proposing we don’t change the cost-sharing formula between the town and employees," Thalasitis said.
Savings mean "a lot when there’s been no salary increases, the last two years," Thalasitis said. In the current fiscal year, employees voluntarily chose to give back just under $500,000 in compensation when Marana struggled to reduce expenses and balance its budget. Thalasitis said an historical average of Marana health insurance rates shows a 3.27 percent annual rate increase since 2004.
The town administration is suggesting the savings be used to pay for any increase next year. "That would be a prudent use of the savings," Thalasitis said.
The town’s dental insurance policy, through Delta Dental, is going up 1.99 percent in price. Delta Dental is giving a three-year guarantee on rates, with a two-year, 5 percent annual adjustment to follow. Mountain States Administration was the previous dental insurance provider. "The big advantage with Delta for employees is the provider list is much more extensive," Thalasitis said.
Marana also has earned a 12.89 percent decrease in rates for its flexible spending account.
Marana holds an employee benefit fair on Thursday, April 29. Open enrollment for insurance is May 3-June 3.