Joliet makes $230,000 dent in $32 million health insurance costs

The Joliet City Council on Tuesday approved changes in health insurance that city officials say will save $230,000 a year as they look to get some control on costs Mayor Terry D’Arcy said are on their way to becoming “almost unaffordable.”

The council in 2016 approved union contracts that locked in health insurance coverage for the next 14 years.

The cost of that coverage has grown from $22 milion in the year those contracts were approved to $32 million, D’Arcy said at the Tuesday meeting. Those costs will grow to $42 million a year by 2030, the year the insurance agreement expires, if the city does not make changes, D’Arcy said.

“We do have a job to do to rein this in because it’s almost unaffordable,” D’Arcy said.

The council voted 8-1 for changes in the insurance plan but only for non-union employees.

The city unions will have to approve any changes in their health insurance before they could be implemented.

About 100 of the city’s 950 employees are not in a union.

The city would save roughly $1.5 million a year if all employees were converted to the new plan, Finance Director Kevin Sing said.

City officials plan to negotiate with the unions in the coming year, and Sing said the new coverage does have appeal because it provides new coverage for preventative care.

“We’ve seen a lot of good feedback on the new plan because of the preventative side,” Sing told the council.

The city calculates its unfunded health insurance liability at $700 million in large part because coverage extends beyond the active workforce to retirees.

City officials originally proposed creating a two-tier system in which any non-union employees hired after January would not be eligible for retiree health insurance. But the two-tier proposal was dropped from the package approved by the council.

Councilman Joe Clement was the lone no vote, although he said the city needed to make changes in its health insurance coverage.

“I want to be part of the solution,” Clement said.

But Clement said the proposed changes emerged about a week ago and needed a closer look before the vote.