Insurance change could save city $90,000

Whether or not to terminate a current health insurance contract in order to save approximately $90,000 was the topic discussion at a recent meeting of Ironton City Council’s finance committee.

Brendan Murray, of Brower Insurance Agency, presented a health insurance plan to members of the finance committee as well as other members of council and a handful of city employees at Wednesday night’s meeting. Brower has offices in Dayton, Columbus, Cincinnati and Springfield.

Murray presented the committee with a health insurance plan through Anthem Blue Cross Blue Shield he says will cost the city $90,000 less in premiums than the plan in place with Medical Mutual of Ohio.

“We did some independent studies specifically in Lawrence County about the cost of care,” Murray said. “Based on that independent study of the cost of care it’s less expensive with Anthem than with Medical Mutual of Ohio.”

The benefits to employees would be better, he said. Some of the specific improved benefits in the plan Murray presented were more office visits for chiropractic care and cardiac rehabilitation. The plan also covers in full routine eye exams and hearing screenings. Under the current plan, eye exams are not covered and hearing screenings require a $20 co-pay. The new plan would also include $25,000 in life insurance for each employee, a benefit that the current plan does not include.

Two months ago the council signed off on an agreement with Medical Mutual of Ohio through Brown/Raybourn, an insurance broker from Ashland, Ky. That contract was for approximately $1.3 million.

At least one council member was hesitant to go back on that agreement.

“Ninety thousand dollars is a lot of money but it is also not very much when you go against what you say you’re going to do,” Waldo said. “A person’s word is something valuable to me as well as the city’s contract with Brown/Raybourn.”

Murray told the committee that it was his understanding that the city contracted with Medical Mutual of Ohio, not Brown/Raybourn.

“I forwarded the wording of the contract to the mayor that says as long as you give them 30 days notice you can cancel the contract at anytime,” Murray said.

Blankenship told council he had approached Murray about insurance. He had heard Murray may be able to save the city money so he enquired about it.

“As the mayor of the city that’s what I want to do,” Blankenship told the committee.

Councilman Bob Cleary questioned whether the company would have the “personal local touch” that Brown/Raybourn has given the city.

Brower is the insurance agency for the Southern Ohio School Insurance Consortium. He told council that if the consortium was not happy it would have said so.

“We may not be here locally but we get a stewardship report for the consortium of all that we’ve done for the account and I don’t think if the consortium was unhappy with the service that we are providing them and their employees that they would introduce us to the City of Ironton,” Murray said.

Dave Brown, of Brown/Raybourn, also spoke to the committee.

He said his biggest concern with the plan that Murray presented is that Murray received a quote from Anthem that was $300,000 less than the one the city received during the bidding process by giving the company information about its own discount factors in the area.

“I’m at a loss to believe that telling a carrier about its own discounts would cause him to change the rates by $300,000,” Brown said. “I don’t understand it.”

Brown said if the council planned to consider using a new insurance company, it should open up bids for other companies to have a chance at a contract.

No action concerning health insurance was taken during the committee meeting.