City council holds line on retiree insurance benefits

In an unanimous vote, the Henderson City Council voted not to lower the health benefits of city retirees under the age of 65 from “enhanced” to “standard”.

The move, if approved, would have saved the city $9,727 in premiums on 42 retired workers.

Earlier this year the council elected to withdraw full retirement medical coverage for those currently working for the city. Those with less than fifteen years of service to the city when the policy was enacted will only have half of their premiums paid by the city until they become eligible for Medicare.

Henderson Fire Department retiree William Perry addressed the council before it took up the issue on the agenda. He said that he understood that the city “is strapped for money”, but stated that one reason he stayed with the city for 30 years was for the benefits that were promised to workers. Perry said that he thought the city could find the money to keep retiree insurance at its current level.

Perry asked the council why he and other retired city workers were not notified by the city about losing some of their benefits. He told them it would have been nice to send a letter. He also mentioned that an arrangement where retirees pay part of the premiums to keep the enhanced service should also have been considered.

One of the issues with the drop in the level of coverage is that prescription medication coverage is affected. A particular medication can change “tiers” along with levels of coverage, and the increase in co-pays can sometimes be dramatic.

During council discussion of the issue, City Manager Ray Griffin characterized the amendment to the personnel policy as a cost-containment matter for this year and for future years. He said that the city would continue to pay 100% of the premium according to the policy that was in effect when the employees retired.

Griffin stated that while the city was dropping the retirees’ coverage from the enhanced to the standard plan that it might make sense for some to contribute toward continuing the enhanced plan, while it would not for others.

After some questions about cost, member Mike Rainey told members that he would like to vote no. He said that he thought the city could find the money somewhere.

“If they can give 30 years of their lives,” Rainey said, “we can find the money.”

The council voted unanimously to keep retirees on the enhanced plan. However, there could be changes to insurance regulations in 2012 that could bring the issue to the surface once again.