In response to Mr Dudek’s letter to the editor on January 19th, I would like to offer the status of The City of Ravenna’s Health Care Benefits and the City’s budget.
Healthcare is one of the largest expenses for the City and has been targeted for change throughout the 2010, 2011 budget process. We began the 2010 year with a budget deficit of $1,838,774.00 and had established significant cost reduction goals for changes to the overall operation of the City including healthcare.
Two specific areas that were targeted in the health care area were, 1) job elimination through attrition and/or consolidation thus reducing the number of covered employees in the City’s healthcare plan and 2) the institution of spousal language for all non-union employees (requiring all non-union members to ensure their spouses were covered under their employer’s plan first). Unfortunately, we were still operating under active Union contracts so could not impose this change on our Union employees.
With the knowledge that Union contracts would expire on December 31, 2010, we fully intended to make spousal language, employee contribution and increased out-of-pocket maximums a major priority in our negotiations with the unions. Unfortunately, our hands were tied with the passage of the Healthcare Reform Act in March of 2010. As a self insured plan, we define our coverage and the plan is considered “grandfathered” under the new law. This grandfathered status provides an exemption from a host of additionally required preventative service coverages under the Healthcare Reform Act. We consulted our Insurance Broker and have been advised that these additionally required coverages continue to be expanded. We are extremely concerned that any funds we may save thru the collection of an employee contribution could be depleted through the processing of claims for the additional mandatory required coverages. In addition, we are currently in the process of accepting dependent enrollees onto our plan as dictated by Healthcare Reform Act. To date we have processed the addition of 10 dependents to our plan which previously were not qualified, adding additional exposure to our plan.
Based on the current health care legislation and the union contracts, we have decided to hold off on any changes to our health care plan at this point. We will continue to intensely study our health care expenditures and ways to reduce the expense for the City.
Beyond the healthcare issue we have made significant progress on the City’s budget in controlling expenses and cutting costs. The city opened the year with an annual operating loss of $1,838,774.00. Intensive changes were made to the City’s operational structure to control expenses and cut costs without affecting city services. We ended the year with an operating loss of $520,363.00. Although a loss, we are headed and moving in the right direction.
I would again thank you for your interest and encourage yourself and all citizens to attend City Council meetings or contact your Council representative to offer your valued input.
Posted by eyeonravenna 
