Alabaster covering portion of retirees’ insurance hikes

Published 10:14 am Thursday, December 10, 2015

The Alabaster City Council agreed to up its contributions to city retirees' health insurance costs during a Dec. 7 meeting. (File)

The Alabaster City Council agreed to up its contributions to city retirees’ health insurance costs during a Dec. 7 meeting. (File)

By NEAL WAGNER / Managing Editor

ALABASTER – Alabaster will up its contributions to help cover city retirees’ health insurance premiums after the Alabama State Employees Insurance Board notified the city it will be increasing retirees’ premiums.

During a Dec. 7 meeting, the Alabaster City Council voted unanimously to increase its monthly contributions to retirees’ health insurance premiums to help offset the cost associated with the increase.

As a result of the vote, Alabaster upped the city’s monthly contributions to $700 per month for retirees on non-Medicare health insurance plans, and increased its contributions to $212.50 for retirees on Medicare health insurance plans.

The increase in city contributions will go into effect beginning with the January 2016 billing cycle. The $700 monthly contribution for non-Medicare retirees is a flat rate, and will be paid regardless of a retiree’s status as single or family insurance coverage.

Any retiree covered by Medicare can stay on the city of Alabaster’s group plan coverage with the $212.50 flat-rate city contribution until the end of the calendar year when the retiree turns 70 years old, according to the resolution approved by the council.

“Any retiree making more than $17,000 per year is not eligible for the city to pay any portion of their health insurance through this or any other program,” read the resolution.

The city’s increase in insurance cost contributions drew praise from the council members.

“This is really to help offset the upcoming health care cost increase for our retirees,” said Ward 1 City Councilwoman Sophie Martin.

“This is a good thing. It’s good for our retirees,” Council President Scott Brakefield added.

The council’s move to increase insurance cost contributions for retirees came a few months after the city approved its 2016 budget, which included merit raises and funding to help offset insurance cost increases for current city employees.

Employee health insurance premiums rose by about 7 percent for the city’s 2016 fiscal year. As a result, the city agreed in September to split the insurance cost by a 70-30 percent ratio.