Dive Brief:
- Pittsburgh is looking to move to a self-insurance program for 2016 in order to avoid skyrocketing premiums and employee co-pays, according to an announcement Tuesday by Mayor Bill Peduto.
- City officials said premiums to Highmark and Aetna, the city's current health insurance providers, are set to increase by $11 million while co-pays are slated to increase from 15% to 20%.
- Under the self-insurance plan, Pittsburgh's expenses will increase by a modest $4 million, and co-pays will be increased to 20% over three years.
Dive Insight:
While the plan is projected to save money, it will also add telemedicine benefits and expand the city's wellness initiative to family members and, ultimately, the public.
Highmark will assume the administrative duties for the self-insured plan, and both Highmark and Aetna will provide telemedicine services, the Pittsburgh Business Times reports.
Rather than paying premiums to the insurers, Pittsburgh will pay claims directly for the city's approximately 3,000 employees. Pittsburgh was previously self-insured in 2007, said city budget director Sam Ashbaugh.
City officials noted that employee unions will need to sign off on the plan.