City health insurance could increase 19 percent
By
Brandy Chandler-brandychandler@gmail.com
The city of Hillsboro is facing a 19-percent increase to health insurance for 2011, which leaves the city facing possible significant cuts to a budget that has a projected imbalance.
The city received two bids, according to Hillsboro Mayor Dick Zink, which were opened on Oct. 29. One was from the city's current insurance agent Doug Wagoner, and the other was from United Health Care out of Illinois.
"When we called (the Illinois company) back, he said he wanted to withdraw his bid because he didn't have all the information he needed to put in an accurate bid. The bid he did put in was quite a bit lower than what we got. The problem was the Ohio (division of United Health Care) would not bid on it. So when we called him back and he said he wanted to withdraw, we said we wanted him to put that in writing."
Zink said that the hard figures on the bids were not available due to some personnel being out of the office. He anticipates the finance committee of the Hillsboro City Council will be meeting later this week to discuss the bids.
Hillsboro Auditor Gary Lewis said that the bid from Wagoner the city received was 19-percent more than what the city paid last year.
Lewis and Wagoner both said that presenting the hard figures, which were initially presented in a spreadsheet format, are difficult to breakdown.
"There are different bids, and different classifications on the same bid," Lewis said. However, he did not have the figures available to him on Monday.
"The actual numbers themselves, I don't have them," Lewis said. "For one scenario, if we went with the renewal, it is 19 percent over what we currently pay. If we included the HSA (health savings account) that premium would be a 17.2 percent increase, or somewhere in that neighborhood."
Lewis said that he was not surprised that the Illinois company withdrew because, "What they submitted was a preliminary quotation and didn't have any specifics."
Wagoner said that in preparing the bid for the city, "We looked at 17 different companies who declined to bid at this time. There are hundreds of companies out there, but there are only so many for our area, to provide the coverage with what we have available in our area. That limits us to some extent. Anthem did work with us to some degree, in that they came down from their initial quote."
Several options were presented to the city by Wagoner.
"When you have a small company with three unions, it's one thing for me to present it - I showed a lot of different options so they will be on the table.
Wagoner said he agreed that such an increase was "Horrible. But I have seen much higher."
The city of Hillsboro had been facing a deficit by the end of 2011. The projected deficit had been as high as $730,000 and as low as $164,000 in recent months. In July, council voted to have the auditor prepare the tax budget so that there would be a carryover between $400,000 and $450,000 into 2012. The finance committee had voted in August to make a recommendation to a full council to cut 10 percent across the board in the general fund for the months of September to December 2010. However, that recommendation was never presented to council.
Lewis said that in order to see that the city has a balanced budget for 2011, "significant" cuts will have to be made.
"The window to make any significant impact (by making early cuts) has been closed some time ago," Lewis said.c"(The health insurance increase) increases what we need to operate, no doubt, because there is an increase in your premiums and you've got to cover that. We obviously don't have the final figures to go into 2011. It looks like there are going to have to be some significant cutting back in the general fund to make that a balanced budget for 2011."
Lewis said that in creating a preliminary budget, he had budgeted for a 10-percent increase.
"To have one that is almost double what I anticipated, it is certainly going to impact the budget," Lewis said. "We're still looking at a significant imbalance projected over by the end of 2011."
Putting a hard number projection on what the potential deficit could be by the end of 2011 is difficult with the changing numbers, Lewis said, but the city may need to cut 7-10 percent from the budget.
"We're talking about the general fund, and again I can only give a guesstimate because it changes on a day to day basis. I would say the city would have to cut probably 7 percent, as much as 10 percent on a $5 million."
Hillsboro City Council President Lee Koogler, and council finance committee chairperson Peter Pence said that council will be addressing the issue this week.
"I became aware (Oct. 29) of the results of the bid opening," Koogler said. "Certainly I have some serious concerns about what we are needing to do to adequately prepare our budget for next year. I have asked the finance committee and the civil service employee relations committee to take a look at the bids and getting prepared for some difficult decisions facing us come the first of the year."
When asked if those "difficult decisions" would include personnel cuts or cuts to services, Koogler said, "Council doesn't have the authority to make those cuts. When it comes to staffing, it is up to the administration. Our job is to look at the budget and determine what it is going to be. They make the decisions on how to live within the framework of the budget. We are exploring all options and will address it as soon as possible."
Pence said that he anticipates calling a finance committee meeting for Wednesday evening.
"We're going to go over all the health insurance numbers," Pence said. "We'll start there and do what we've got to do. The really big unknown is that there are several different options with the health insurance and a lot of it is going to come down to what can be negotiated with the unions, and unfortunately I can't speak for them and I don't know exactly how that will work out just yet. But we are going to look at it, and assess it, and move forward."
The city of Hillsboro is facing a 19-percent increase to health insurance for 2011, which leaves the city facing possible significant cuts to a budget that has a projected imbalance.
The city received two bids, according to Hillsboro Mayor Dick Zink, which were opened on Oct. 29. One was from the city's current insurance agent Doug Wagoner, and the other was from United Health Care out of Illinois.
"When we called (the Illinois company) back, he said he wanted to withdraw his bid because he didn't have all the information he needed to put in an accurate bid. The bid he did put in was quite a bit lower than what we got. The problem was the Ohio (division of United Health Care) would not bid on it. So when we called him back and he said he wanted to withdraw, we said we wanted him to put that in writing."
Zink said that the hard figures on the bids were not available due to some personnel being out of the office. He anticipates the finance committee of the Hillsboro City Council will be meeting later this week to discuss the bids.
Hillsboro Auditor Gary Lewis said that the bid from Wagoner the city received was 19-percent more than what the city paid last year.
Lewis and Wagoner both said that presenting the hard figures, which were initially presented in a spreadsheet format, are difficult to breakdown.
"There are different bids, and different classifications on the same bid," Lewis said. However, he did not have the figures available to him on Monday.
"The actual numbers themselves, I don't have them," Lewis said. "For one scenario, if we went with the renewal, it is 19 percent over what we currently pay. If we included the HSA (health savings account) that premium would be a 17.2 percent increase, or somewhere in that neighborhood."
Lewis said that he was not surprised that the Illinois company withdrew because, "What they submitted was a preliminary quotation and didn't have any specifics."
Wagoner said that in preparing the bid for the city, "We looked at 17 different companies who declined to bid at this time. There are hundreds of companies out there, but there are only so many for our area, to provide the coverage with what we have available in our area. That limits us to some extent. Anthem did work with us to some degree, in that they came down from their initial quote."
Several options were presented to the city by Wagoner.
"When you have a small company with three unions, it's one thing for me to present it - I showed a lot of different options so they will be on the table.
Wagoner said he agreed that such an increase was "Horrible. But I have seen much higher."
The city of Hillsboro had been facing a deficit by the end of 2011. The projected deficit had been as high as $730,000 and as low as $164,000 in recent months. In July, council voted to have the auditor prepare the tax budget so that there would be a carryover between $400,000 and $450,000 into 2012. The finance committee had voted in August to make a recommendation to a full council to cut 10 percent across the board in the general fund for the months of September to December 2010. However, that recommendation was never presented to council.
Lewis said that in order to see that the city has a balanced budget for 2011, "significant" cuts will have to be made.
"The window to make any significant impact (by making early cuts) has been closed some time ago," Lewis said.c"(The health insurance increase) increases what we need to operate, no doubt, because there is an increase in your premiums and you've got to cover that. We obviously don't have the final figures to go into 2011. It looks like there are going to have to be some significant cutting back in the general fund to make that a balanced budget for 2011."
Lewis said that in creating a preliminary budget, he had budgeted for a 10-percent increase.
"To have one that is almost double what I anticipated, it is certainly going to impact the budget," Lewis said. "We're still looking at a significant imbalance projected over by the end of 2011."
Putting a hard number projection on what the potential deficit could be by the end of 2011 is difficult with the changing numbers, Lewis said, but the city may need to cut 7-10 percent from the budget.
"We're talking about the general fund, and again I can only give a guesstimate because it changes on a day to day basis. I would say the city would have to cut probably 7 percent, as much as 10 percent on a $5 million."
Hillsboro City Council President Lee Koogler, and council finance committee chairperson Peter Pence said that council will be addressing the issue this week.
"I became aware (Oct. 29) of the results of the bid opening," Koogler said. "Certainly I have some serious concerns about what we are needing to do to adequately prepare our budget for next year. I have asked the finance committee and the civil service employee relations committee to take a look at the bids and getting prepared for some difficult decisions facing us come the first of the year."
When asked if those "difficult decisions" would include personnel cuts or cuts to services, Koogler said, "Council doesn't have the authority to make those cuts. When it comes to staffing, it is up to the administration. Our job is to look at the budget and determine what it is going to be. They make the decisions on how to live within the framework of the budget. We are exploring all options and will address it as soon as possible."
Pence said that he anticipates calling a finance committee meeting for Wednesday evening.
"We're going to go over all the health insurance numbers," Pence said. "We'll start there and do what we've got to do. The really big unknown is that there are several different options with the health insurance and a lot of it is going to come down to what can be negotiated with the unions, and unfortunately I can't speak for them and I don't know exactly how that will work out just yet. But we are going to look at it, and assess it, and move forward."
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