PLAINVILLE – The Town Council authorized the second appropriation of $550,000 Monday night to help cover a more than $2 million deficit in the town employee health insurance fund.
“We need to backfill the deficit,” said Town Manager Robert Lee. “It needs to be done.”
Members of the council appropriated $550,000 from the unassigned fund balance for the first time in February.
The town has been on a self-insured plan since the 90’s. A total of 900 people are currently on the self-insured plan with 400 being employees.
Lee said the town usually sees about eight people on the plan exceed $75,000 in claims a year. Last year, 21 people exceeded $75,000 and made up over 50 percent of total claims for 2017.
“We’re trying to move off a self-insured plan,” said Kathy Pugliese, chairwoman of the council.
Officials discussed the possibility of joining the state Partnership Plan moving forward which is a low/no deductible point-of-service plan for municipalities.
Lee said while the rates would be higher, the recent claims would likely be more of an increase with further claims predicted.
“We’re continuing to exceed expected claims,” he said.
Monday night’s appropriation was the second of four expected transfers for the insurance fund. The third transfer will likely be another $550,000 while the fourth appropriation is still to be determined.
The health insurance deficit is a major driver of the over 2.5 percent budget increase residents will vote on during the all-day budget vote on Tuesday, April 24.