City workers health care insurance in limbo for FY2015/16

Submitted by Suanne Z. Thamm

Reporter - News Analyst

September 3, 2015 4:16 p.m.

It looked like a routine matter of business before the Fernandina Beach City Commission at their September 1, 2015 Regular Meeting. It turned out to be anything but.

Resolution 2015-126 called for approval of a contract with United Health Care for city employee health care insurance benefits and with MetLife for dental insurance coverage for a period of one year, with one one-year renewal at the desire of both parties.

Apparently city employees had first learned of the city’s plan to switch to United Health Care (UHC) from Blue Cross/Blue Shield (BC/BS) the previous Thursday. Even though, as the city’s insurance consultant explained, out-of-pocket costs and benefits would remain largely the same, that explanation was not sufficient to appease representatives of the Police and Firefighters unions, who expressed alarm that the proposed change had not been brought to the bargaining table.

Both unions expressed fears that they would be forced to file Unfair Labor Practice (ULP) complaints against the city for failure to bargain on a change in working conditions.

City Attorney Tammi Bach, who left the meeting abruptly to consult with the city’s labor counsel, expressed her displeasure at being apprised of the situation at such a late date. The city’s health insurance plan must be in place by the beginning of the new fiscal year, October 1, 2015. At the end of the meeting she reported that she was confident that the issues could be resolved and that city employees would indeed be covered by health insurance in the new year.

A special meeting has been scheduled for September 9 at 10:00 a.m. to take action on this item.

In making his presentation to city commissioners during the September 1 meeting, insurance consultant Larry Gusti explained that the decision to switch health insurance carriers was being recommended due to increased costs and greater benefits offered under the UHC plan. The city’s practice is to pay 100 percent of each employee’s health insurance and 50 percent of dependent coverage costs. The BC/BS proposal had come in at 20 percent higher for the next year, while the UHC plan was only 10 percent higher than the proposal they submitted last year. Plus the UHC proposal added the Mayo Clinic as a plan provider. And at the current time it appeared that Borland Groover Clinic was dropping out of the BC/BS plan. Gusti added that the new carrier covered 96.7 percent of the providers in the current BC/BS plan.

Attorney Greg Forhan claims that city neglected to bargain with union over health insurance change.

Greg Forhan, attorney representing the Police union, said that he had just learned of the change last Thursday. He reminded commissioners that the city has a duty to bargain such a change and asked that they take no action until that obligation could be fulfilled. James Tucker, representing the Firefighters local, echoed Forhan’s concerns, adding that the new HMO provided by the plan was more expensive than the proposed PPO.

An obviously surprised and aggravated City Attorney asked Forhan why, if he had learned of the situation on Thursday, he had waited to bring it up until the following Tuesday at a FBCC meeting when he could have called her to try to resolve the problem. Forhan cited press of other work in other parts of the state.

Bach, after consulting with the city’s labor counsel, advised the FBCC not to take action at this time to avoid facing ULP complaints.

Larry Gusti explains reasons for city to switch health insurance carriers.

Insurance consultant Larry Gusti reminded commissioners that issues needed to be worked out within a week in order to allow time to transition to the new health plan. He also tried to allay concerns that employees in the middle of treatment under the old plan might have difficulty maintaining the same level of care from the same providers under the new program. He said that insurance companies provide for “transitional care” for such circumstances.

Commissioner Tim Poynter asked, “Why are we here now at the last minute? Why didn’t we talk to the unions earlier?”

City Manager Joe Gerrity said that the city has not involved the unions in these health insurance negotiations for the past three years.

It should be noted, however, that during the past three years the city remained with the same carrier, only negotiating rates with the plan provider.

Editor's Note: Suanne Z. Thamm is a native of Chautauqua County, NY, who moved to Fernandina Beach from Alexandria,VA, in 1994. As a long time city resident and city watcher, she provides interesting insight into the many issues that impact our city. We are grateful for Suanne's many contributions to the Fernandina Observer.