Health insurance rates for most Scottsdale employees will jump roughly 50 percent next budget year as the city grapples with skyrocketing medical expenses.
The City Council on Tuesday night voted 6-1 in favor of a proposal to raise the monthly premiums for employees on the two main plans — provided by Aetna and MMSI Health Traditions. However, the increase was far less than initially proposed.
With Scottsdale’s two police unions pressing to reduce the cost for employees, the council labored to divide the growing expense between workers and taxpayers.
Willis of Arizona, an outside consultant, projected that the city’s medical costs will rise to $21.9 million next budget year, which begins July 1. That would be $5.2 million higher than this year.
The initial benefits proposal, vehemently opposed by the unions, budgeted to cover that total projected cost. As a result, some employees would have faced a 400 percent increase in health insurance costs. The council rejected that proposal two weeks ago.
But rather than increase Scottsdale’s share of the expense, city officials opted to collect $2.9 million less than the consultant estimated the city will need.
Should those projections prove accurate, the city will face a shortfall that must be filled with public dollars from elsewhere in the budget.
Councilman Ron McCullagh, the lone dissenter, chided the council for ignoring the consultant’s projection. “Our actuaries are telling us from day one that the policy you’re proposing is unsound,” he said.
The police unions gave muted support to the new proposals. “We’ve made what I believe is the best we can of a bad situation,” said Chet Anderson, president of Scottsdale’s Fraternity of Police.