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The city of La Grange could save more than $30,000 after city council voted to change insurance benefits Aug. 6.
About 24 full-time city employees previously paid 5 percent of their premiums, but will now pay 10 percent, doubling their monthly expense.
While many workers across the country have faced rising healthcare costs, La Grange employees pay less than national averages, according to council member Jason Taylor.
Employees with an individual plan will pay about $46 per month, he said, or $552 per year.
The city’s most expensive family plan will cost about $72 per month or $864 annually.
Nationally, people with an employer-funded family plan paid an average of $4,129 of their premium in 2011, according to a study by the Kaiser Family Foundation. That reflects a 9 percent increase in premium costs from 2010.
Keith Crowder, the city’s public works director, said in June that the increase unfairly negates raises city employees received last year.
Taylor, the city’s ordinance committee chair, said the 3 percent raises employees received more than covers the increase in insurance costs.
Taylor originally pushed for the employee contribution to be 20 percent.
Nationally, employers pay an average of 70 percent of an employee’s premium, he said, and none of a spouse’s premium. City employees now have 90 percent of the premiums covered for all family members on their plan.
Kevin Collett, chief of La Grange Police, said the city’s insurance benefits are a recruiting tool for his department. The benefits offset salaries lower than other departments.
“What we save in cost, we could lose in recruitment,” he said. “We need to make sure we look at the tradeoff.”
Council member Tad Humble said he opposed the ordinance because it doesn’t address changing how benefits are offered to new employees.
While council members don’t want to drastically increase the amount current employees pay, Humble said the city could save more money by offering benefits more similar to national averages to new employees.
“This just puts a Band-aid on it,” he said. “We should address new employees before changing current (employees’ plans).”
Mayor Bill Lammlein said he’s not opposed to the council revising the ordinance at a later date to modify offerings for new employees, but wants a revised policy for current employees implemented.
Lammlein said he has no plans to hire additional full-time employees.
The increase passed 5-2, with Humble and Joe Davenport opposed.
Employees of La Grange Utilities will also be affected. Coverage is bundled under the city’s same insurance plan, although salaries are paid by the utilities commission.