Insurance flap hits Harrisburg council
</element><element id="paragraph-1" type="body"><![CDATA[Harrisburg City Council met with city employees in adjourned session Monday morning to hear discussions on a controversial employee insurance plan.
Council members believe the plan results in the same amount of coverage for employees with a nominal co-pay and at a potential savings of $15,000 a month to taxpayers.
Employee union representatives say the council adopted the plan without consulting the union, is in violation of the contract and jeopardizes constructive talks during ongoing contract negotiations.
As city insurance representatives Jim Williams and Steve Williams of Williams and Associates explained the issue, the city adopted a health reimbursement account - or HRA - in December with a high-deductible insurance policy of $5,000 and it took effect in January.
Blue Cross/Blue Shield apparently listed in paperwork employees received HSA - Health Savings Account - instead of HRA.
Employees stated at the meeting they were surprised when getting prescriptions pharmacists were asking them to pay for medications up front. Under the HRA, they are to be reimbursed by the city except for a co-pay of $25 or less. Employees are to send their receipts to Shawnee Administrative Service in West Frankfort, which is the third party administrator of the program.
Steve Williams said if employees use a credit card to pay for medication there should be no issue. They should be reimbursed before the next credit card payment is due. The issue should not even arise during doctor visits, Jamie Simmons of Shawnee Administrative Service said. Employees can simply present their Blue Cross/Blue Shield cards and, if asked if there is a co-pay, they should say "no" and they will be billed for the copay through Shawnee Administrative Service.
City Employee Kelly Hefner said he understands if he has a $200 bill he can provide that bill to Shawnee Administrative Service and expect to get the $175 paid back to him with $25 kept as co-pay. The problem, as Hefner sees it, is that $25 co-pay is then put toward his deductible. Once an employee reaches $5,000 worth of medical care there is no co-pay owed. But language in the contract stipulates there is to be zero deductible for employees to pay.
Council members said the situation is temporary until a collective bargaining agreement with employees is reached and was only intended as a method to save taxpayers money.
One employee said a weakness in the plan was revealed to him by one of his children. He said both children are out of state and are covered by his insurance plan. If they need medication and the clerk looks at the insurance card and sees there is a $5,000 deductible, they would have to pay out-of-pocket with the hope of receiving reimbursement.
"My recommendation is to put it on a credit card, get the receipt, give it to Jamie and it ought to be reimbursed back," Steve Williams of Williams and Associates said.
Another employee said he has no credit card, only a debit card to his bank account that rarely has $3,000 in it.
Police Chief Bob Smith said he also has a child away at college and he is worried his son could be denied emergency health care without money on hand.
"Have the provider call my office and we can get that waived. The only time they should pay up front is at a pharmacy," Simmons said.
Employees and council engaged in back and forth discussions regarding the reason for the change.
Councilman Ron Crank said the city was spending $15,000 per month waiting on application forms from employees. Firefighters John Gunning said the city had the required forms since Oct. 5. Treasurer Charlie Will said several of those forms had incomplete information and some did not even have names on them to direct him on who to notify about incomplete information.
Gunning asked why the union was not notified.
Will said he spoke to each department during the last week of December.
Danny Dunn, representative for the Street and Alley Department, said Will spoke to him, but he did not believe the conversation should have been interpreted as approval from the union.
"I said, 'No, you do not have my permission to do this without talking to everybody else,'" Dunn said.
"I have no authority without talking to other members of the bargaining unit."
Brandon Morse of the Water Department said no one had talked to him about the change.
Mayor Eric Gregg said the change was intended as a temporary solution that would keep the current coverage for employees while saving taxpayer money until a permanent solution is reached through collective bargaining negotiations.
"This was not intended to be mean-spirited," Gregg said.
Simmons said he has talked to owners of local pharmacies Medicap and Medicine Shoppe and both are ready to work with the city's program, charging a copay of between $5 and $25 depending on whether the prescriptions are generic or brand name. He said national pharmacies do not have the data in their systems to tell the difference under the city's system.
"We can fix this. It's doable," Simmons said.
Crank asked those who have the family insurance plan to note the amount the city pays to the insurance company for their coverage is down $500 from the previous plan.
"It was done in the dark," an employee said.
Gregg said he hoped the employees understood the city's position and responsibility to taxpayers.
"We made the decision to save the city $15,000 a month," Gregg said.
"We had to pull the trigger on this."
He said the problem was one council inherited and did not create.
Jim Williams said the issue came up in 2010 and had the council then acted on it, it could have saved the city $180,000 over the course of 2011.
Hefner said he recognized the measure was well-intended, but also indicated he believed it was naive for council to alter health insurance procedures while union negotiations are ongoing.
"You say you guys pulled the trigger. The thing is, that's a negotiable item. This has changed the structure of our negotiations," Hefner said.
Police and Fire Commissioner Bart Schiff asked Jim Williams for an estimate on how much employees should expect to be paying in co-pays each month based on previous years. After some quick discussion, the figure of about $500 per month was brought up.
"We're in here over $500 a month?" Schiff said.
"Why don't we just go ahead and pay the whole damn thing?"
Fearheiley said he was inclined to agree.
"If we voted to take care of all the prescription money, will that calm you all down?" Fearheiley said.
"That's probably working toward the right way," Hefner said.
Hefner said in his view the city is treating the program like it has set up a health care expense account HCA, which it hasn't, and as a result the employees are without health insurance until they have reached the $5,000 deductible.
Simmons said there are options. One is employees could be issued debit cards that only may be spent on eligible health care items.
"Our charge now is to look at ways we can tweak this," Gregg said.
Gregg asked city loss control officer and insurance man Bill Ghent if he had any recommendations.
Ghent said setting up an HCA would be beneficial. Under such a plan any of the $5,000 deductible not reached by an employee in a year would be retained by the city in an account and could build up over time. However, by taking on such a high deductible the city has to be prepared to pay it if required.
Ghent had a more serious note to both parties.
"Fix this now," Ghent said.
He recommended fixing the insurance plan first before addressing other issues in contract negotiations. But also asked everyone to keep in mind the National Health Care Act takes place in 2014. Ghent predicts any agreement the two parties reach may be out the window by 2014 and at that time it could be impossible for the city to afford the zero-deductible insurance it has provided workers.
He said employees may have to take ownership of their health insurance.
"Other than that, this is heading toward a pretty big disaster," Ghent said.
"The issue is significant and it really needs to be handled now."
Firefighter Donnie Wall said city employees know they have had excellent insurance coverage provided by the city, but wanted council to understand that coverage has come at a price. He said workers have accepted less of a raise in contract negotiations.
"Instead of a dollar, we may take a dime," Wall said.
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DeNeal receives e-mail at bdeneal@yourclearwave.com.</li>
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