The Pekin City Council on Monday gave City Manager Tony Carson the go ahead to sign documents for self-insurance for all employees outside of the Teamsters Local 627.

The local is in contract negotiations and its insurance for the time being will remain with Teamster’s insurance product, Central States Health and Welfare Fund.

City Manager Tony Carson said the city has already went out for requests for proposals, which came back significantly lower than its current carrier. The city will go with Unity-Point Health’s insurance product as a self-funded plan. Group Plan Solutions will provide reinsurance, or coverage for catastrophic health claims. Carson said the city expects to save from $250,000 to $900,000 in the first year. There are some outstanding applications that still need to be evaluated by UnityPoint, so a final figure is not yet available.

The self-insurance will cover health, life, dental, vision insurance for all full-time eligible employees.
Carson said there is a 60-day window for the application process that has to be met because the health of members can change during the insurance review process.

Unland Insurance Executive Vice President Bill Shock said the insurance will be administered by Group Plan Solutions, which is a wholly owned subsidiary of Pekin Insurance. Unland was the city’s consultant when the city was previously self insured, said Shock.

“(GPS) will be paying all of the claims, be administering the plan and securing the reinsurance for the plan,” said Shock. “We were just the architect, if you will, of piecing it together. Unland is the city’s consultant.”

Human Resources Director Sarah Newcomb said Group Plan Solutions will be serving as the third-party administrator and providing all of the HIPAA protections.

Newcomb said the city had self-insurance for many years, but former City Manager Dennis Kief negotiated a contract with Teamsters Local 627 in 2009 that converted the insurance to the Teamster’s insurance product, Central States Health and Welfare Fund.

The city would see an 11.5 percent increase in insurance premiums from Oct. 1 through September 2018, and a 13 percent increase from Oct. 1, 2018 through September 2019 if it remains with Central States under the same contract. The city hopes to have a plan in place to save money by Oct. 1.

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