SEABROOK — As twice-weekly budget hearings get under way, town officials were stunned to learn yesterday that Seabrook’s insurance carrier is raising health insurance premiums more than 26 percent for the 148 employees on its policies.
The figure came as a blow to Town Manager Bill Manzi and the Board of Selectmen, who along with many staffers have worked long hours reformatting and pulling together next year’s draft budget document. Manzi, who received notice of the increase right before yesterday’s 10 a.m. selectmen’s meeting, said the unprecedented hike is bad news.
Manzi said he could only guess at the causes for such an enormous increase. One reason is the possible impact of new federal requirements due to the implementation of national health care reform in the Affordable Care Act, he said. The other reason he could think of is the long-standing industry practice of establishing health insurance premiums based on the experience of the group insured, Manzi added.
Health insurance carriers use both the demographics of those insured — which includes age and lifestyle issues such as smoking — as well as the annual number of claims they pay and the amount.
Insurance costs have long been a bone of contention in town. In 2011, Seabrook officials worked for months to find a way to reduce the then-$3.2 million cost of insurance in the town’s $18 million annual operating budget. The town’s contracts with its unions mandate specific health insurance coverage.
A long-sought solution was believed to have been found in January 2012 with Lumenos, an innovative plan estimated to save the town about $750,000 over a three-year period due to an agreement with the unions.
It is offered through Anthem/Blue Cross and Blue Shield of New Hampshire via the HealthTrust, the insurance arm of the N.H. Local Government Center, which also provides the other two plan options from BCBS that a few are still on: the expensive JY plan and lower-cost Blue Choice.