Health Insurance increases for West Palm Beach

By Pat Beall



Palm Beach Post Staff Writer



Tuesday, December 21, 2004



WEST PALM BEACH — For the fifth time in as many years, the city of West Palm Beach is facing a double-digit hike in health insurance costs.



Insurance premiums for most city employees such as clerks, planners and engineers, will jump by 13 percent Jan. 1.



For police, insurance premium costs are set to rise by 9.2 percent.



Both groups of workers are covered through Blue Cross and Blue Shield of Florida.

Despite the hikes, "We have done relatively well," said Thomas Harris, chief financial officer for the city. Deductibles and co-payments remain modest, he added.



Insuring government employees in Florida can be pricey. Between 2001 and 2002, the most recent year for which independent figures are available, health insurance premiums for state employees surged by 15 percent.



The city's pending insurance bill has hikes above 2004's average 5.5 percent reported by employers with fewer than 499 workers, according to a recent Mercer Human Resource Consulting study.



But other studies conclude that cities, towns and states typically have higher premium costs because they typically offer generous benefits. Some are related to job descriptions. For example, the West Palm Beach police department contract this year doubled provisions for physical therapy from $1,000 a year to $2,500 a year.



Other benefits offered to municipal workers are similar to those offered by large corporations. For example, lifetime maximum insurance payouts for West Palm Beach workers who are not on the police force top out at $5 million in one Blue Cross plan. In another Blue Cross plan being offered they are unlimited.



On a percentage basis, the continuing hike in rates "certainly outpaces our revenues," Harris said. That's not to say trimming benefits or passing costs on to workers through higher deductibles is on the horizon. The city budgeted enough money to fund the extra health insurance bills.



Even so, Harris said the city is concerned about the pattern: "We're trying to come up with some alternatives to try and turn that trend around."