There will be no immediate cuts or changes to health care for city of Independence retirees who are eligible for Medicare.
But the city can't continue down the same path with health-care costs, City Manager Zach Walker says.
The City Council unanimously passed the approximately $320 million budget for fiscal year 2019-20 following a series of amendments submitted by Walker that included waiving previously proposed changes to health-care coverage for current employees and retirees under age 65.
The budget had included plans to bid out post-65 retirees' coverage to Blue KC as a Medicare Advantage plan – one that many retirees and citizens saw it as inferior coverage compared with what had been previously promised and balancing the budget on the retirees' backs.
Instead, the council Monday unanimously passed a resolution to create a special health insurance review committee to recommend Medicare coverage options.
Essentially, Walker said before the council meeting, the committee will “go out and shop the marketplace” and report back to the Oct. 1 with a solution pleasing to both sides before open enrollment for next year begins.
Ideally, Walker said, such a plan would provide Medicare retirees with a coverage equal or similar to what they have now and would cost both sides less.
Any health-care changes would not take effect until Jan. 1, 2020, as the health-care plans follow the calendar years, and the budget included funds for post-65 retirees under the Stay Well plan.
“All we're asking for is additional time,” Walker said of the resolution for the committee.
The committee would/will consist of:
• Three members of the city manager's office.
• Three members of the Stay Well executive committee.
• Three ex-officio, non-voting retiree plan member representatives designated by the three Stay Well representatives.
Walker had proposed the health-care changes to address a $3.6 million shortfall in the general fund and ease some budget constraints moving forward. To compensate withdrawing the other health-care changes, Walker sliced more than $1.6 in proposed spending from the general fund budget – including nearly $450,000 for six new police officer positions.
The resolution seemed to at least temper some fiery concerns. Monday's meeting, while packed to the brim like several others the past couple months, did not feature angry uproars that produced a pounding gavel from Mayor Eileen Weir.
“This committee will be asked to look at all areas, all options,” retired firefighter Chris Rohrs said. “It puts us back on a starting point, on a level playing field.”
“We're hoping this committee protects us,” retired firefighter Henry Carner said of the class of retirees. “Nobody has the ability to vote on our behalf.”
Reading a letter endorsed by numerous former department directors and managers in the city, former Fire Chief Sandy Schiess upbraided the originally proposed changes.
“As a group, we faced such circumstances every year,” Schiess said of budget constraints. “We found solutions to those problems, and it was never easy. But the long-term well being of those who served the city was never threatened as it is now.”
“We are confident that solutions to the current budget issues, including modifications to the Stay Well plan, can be found in the coming months, and we are committed to assisting in doing so.”
“I think (the committee) will do good work,” added firefighter union leader Kirk Stobart. “This is something that should've been done from the very beginning, that we have input.”
“One of the things that has been a problem is we haven't had time to look at this. What I want to know is the history of retirees and what their cost (versus contributions) has been historically.”
A couple hours before the council meeting, a hundred-plus retirees, employees and citizens gathered to address their concerns about the proposed health care change and whether the resolution was good enough.
“How is this different than Social Security or Medicare?” retired police officer Bob Sorensen said of promised benefits that employees worked, repeating much of it later to the council. “They promised it, they owe it to us. Every day we worked, we paid for it.”
“I don't want us to lose our class status,” Carner said. “We need to have the same (premium cost) split as employees.”
Power & Light cuts
Also among the budget amendments were $5.45 million in cuts in Power & Light to account for the upcoming 4 percent across-the-board electric rate cut the council approved last month.
The cuts include $1.3 million in salaries and benefits thanks to a hiring freeze, $2.23 million in operating and maintenance efficiencies and $1.8 million in capital improvements.
A council majority did vote down two budget amendments that would have rescinded the 8 percent electric rate cut given five years ago to schools – most notably Independence Schools – as well as charged the district $30,000 for food inspections.
ISD Superintendent Dale Herl said undoing the rate cut would cost the district nearly $330,000, and with its budget nearly finalized the only feasible cuts would come from supplies and field trips. He added that while the district doesn't pay for food inspections, it also doesn't charge the city to use its facilities.